Poverty rates in the UK could increase dramatically by 2020, as a result of changes in the labour market, as well as the tax and benefits system.
That is the finding of research conducted by the Joseph Rowntree Foundation, which has found that relative poverty rates will inch up in the next eight years.
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The report argued that changes to the structure of the employment market over the next ten years, such as general improvements in the qualifications and skill levels of workforce, will only serve to widen the gap between the rich and poor.
Although there will be more jobs in the future, they are unlikely to halt the rise of poverty. The report anticipates around 1.5 million new jobs by 2020, but most families in low-income household don’t work – meaning the increase is unlikely to better their situation.
It goes on to say that although income levels are expected to rise over the next decade, they will fall in real terms due to savings in social security spending.
In addition, as wages are more of a key income source for those at the middle and the top, rather than those at the bottom, relative poverty will continue to rise.
“We need to think again about what would be most effective in reducing poverty,” said Chris Goulden, Poverty Programme Manager at the Joseph Rowntree Foundation.
“Under current tax and benefit policies, and with the labour market we expect to have by 2020, both relative and absolute poverty rates for families will rise to around one in four,” he added.
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