Some of the fastest growing sectors of the economy are the most precarious for people to work in. This uncertainty of where the next pay cheque will come from goes hand-in-hand with poverty. The risk of falling below the poverty line is greatest for families where no one has a job, but the rising number of low-paid jobs in the economy now means around half of all families in poverty have at least one person in employment.
Part-time work and low hourly pay are both associated with an increased chance of living in poverty, while employment in a precarious job with little or no job security increases the risk of recurrent and persistent poverty.
In–work poverty is more common among people working in certain sectors: the highest poverty rate is found among people working in the accommodation and food service sectors. High rates are also found in retail and in residential care.
The government has traditionally focused on moving people into work as part of its strategy to tackle poverty. But now that in-work poverty is affecting increasing numbers of households, it should widen its focus to encompass issues of job quality for those in precarious employment, and opportunities for them to progress in the labour market.
Such a policy shift will need to engage with these issues in the context of low-paid sectors – and a number of these are projected to be important components in national employment growth in the coming years. These are issues which link to current research examining the ways to harness the growth of certain sectors to help reduce poverty.
Government policy is currently focused on raising the income tax personal allowance and the introduction of a National Living Wage (NLW). While the terminology used is questionable, the NLW is a real increase on the National Minimum Wage. Yet at the same time as it is introduced, financial support for low-income households will be reduced as a result of cuts to welfare spending through the introduction of Universal Credit.
