Changing patterns of poverty in early childhood

Poverty and its changing nature are an essential lens through which to understand early childhood. At 36%, the rate of poverty among families where the youngest child is under five is high—and increasing (DWP 2021). In this review, we undertake original data analysis to illuminate patterns of poverty in families with a young child. 

Experiencing poverty at the start of life and in early childhood can be highly damaging, with potentially profound effects on children’s long-term well-being and opportunities. The causes, patterns, and solutions to poverty have become more complex and interlinked over the last two decades. Disruptive forces, such as a rapidly changing economy and labour market, increasing levels of in‑work poverty, more complex family structures, structural inequalities between ethnic groups, and differences by place have changed the contexts in which young children are growing up, as well as their life chances. 

Poverty is about both economic disadvantage and the tangled pressures that can influence the responses and behaviours of those caught within it. Family life has become more complex —economically, socially, culturally— and more unequal. Policy responses, if they are to be durable, need to reflect the combined effects of these different factors on young children’s lives.

Age and number of children

• Child poverty rates for families where the youngest child is under five are higher than for those with older children, reflecting the fact that they tend to be larger families with higher needs and lower levels of employment.
• In 2019/20, of all families with young children in poverty, over 54% had three or more children compared to less than 14% for single child families.
• This increased risk of poverty for larger families reflects the impact of social security changes including the ‘two-child’ limit that restricts the child element of social security benefits to the first two children in a family (born after 2017) and the abolition of the family element of child tax credits.

Employment and family status

• Children in working families account for an increasing share of all children in poverty, due both to population changes and the decline in unemployment. Since 1999/2000, the risk of poverty for families with the youngest child under five and at least one adult in full-time work has increased by 16%.
• Since 2013/14, the risk of poverty for part-time working families has increased 26 percentage points to a level almost matching unemployed families.
• There is a much higher risk of poverty for children living in lone parent families where the youngest child is under five (57%) compared to those whose parents are married or in civil partnerships (28%) or cohabiting (38%).
• While the risk of poverty for children in lone parent families remains high and has been rising in recent years, there has been an overall decrease over the last two decades, from a high of 75% in 2000/01, reflecting an increase in the proportion moving into paid work.

Ethnicity

• For children living in families with at least one child under five, there is a distinct gap between poverty rates for young children growing up in White, Indian and Chinese families, which stood at around 30%, and most other ethnic groups, which often exceed 50%. These higher rates of child poverty partly reflect the younger age profile of some ethnic minority groups, but also structural inequalities and discrimination.
• The fact that nearly three in four children (71%) from Bangladeshi backgrounds face poverty, and more than one in two in some other ethnic minority groups, is an urgent issue for policy makers to address.

Regional differences across the UK

• Child poverty in families where the youngest child is under five are higher in England and Wales (35% and 34%) than in Scotland (28%) and Northern Ireland (27%).
• Within England, the North East has the highest rate of early childhood poverty (46%), followed by London (41%). Rates are lowest in the South West (29%). In the South East and East of England, early childhood poverty is slightly higher now than it was 20 years ago.
• Since 2013/14, child poverty rates have been on the rise in some parts of the country. Child poverty rates in Middlesbrough, Birmingham and Manchester now stand at over 40% of all children, compared to 30% across the UK as a whole.