Low-income families more vulnerable than ever due to the impact of coronavirus – new research

Two new reports published today have highlighted how the coronavirus pandemic has increased insecurity for low-income families.

Researchers at ÌìÌÃÊÓƵ have been working with a group of families over a five-year period to learn more about the impact of various socioeconomic factors, such as income, benefits, digital resources and access to services.

The two reports, and , have been published by the Joseph Rowntree Foundation today (09/03).

They found that changes in work, benefits, health and family circumstances meant that living on a low income often involved uncertainty, even before the pandemic hit.

Parents without stable work, particularly those without a partner in work, faced the most severe difficulties before and during the pandemic.

While furlough has helped some families, people with insecure or temporary contract work were at higher risk of job loss or decreased hours. Other sources of income were also affected.

Child support payments in separated families had sometimes fallen or stopped where an ex-partner lost work, and income from working older children suffered as many young adults’ jobs have disappeared.

For many families, difficulties making ends meet on already stretched or reduced income has coincided with increased costs, in particular food budgets when children spent more time at home – and higher heating costs in the winter was a real worry.

Throughout this study, families have depended on the social security system to top up earnings and provide a lifeline in tough times.

However, it was not always an adequate or stable source of support and could be a source of anxiety.

Austerity cuts have created benefit levels seen as far too low, exacerbated by delays and deductions, putting families under severe financial strain.

People claiming health-related benefits worried about the stability of their income and going through the stressful assessment process.

While the £20 uplift in Universal Credit made during the pandemic has now been extended until September 2021, the still temporary nature of the increase creates further uncertainties.

An additional concern was that some families on low incomes have found it difficult to keep up with the growing digital needs during the pandemic.

Those unable to afford the equipment or internet connection required for effective home learning risk added disadvantage.

Lead author Katherine Hill, of ÌìÌÃÊÓƵ’s Centre for Research in Social Policy (CRSP), said: “When we have asked families on low incomes what would most improve their lives, they have repeatedly come back to the need for stability and an adequate income.

A striking finding was that even though sometimes families in the study were able to ‘get by’ and keep on top of outgoings, they almost all faced ups and downs, experiencing periods when it was hard to keep afloat over the five years.

“Having a stable and sufficient income from work and the benefits system has become more elusive in recent years, exacerbated now by the impact of the pandemic.

“Creating greater stability in these income sources should become an important priority in post-pandemic policies.

“Families say that what would help them most is secure jobs, with stable and reasonable pay to help them get by with a little breathing space and build financial resilience.

“Issues around the gig economy and moves to improve workers’ rights, such as the recent Supreme Court case on Uber drivers, will become ever more important.

“Families on low incomes need a social security system that they can depend on, so it isn’t a continual struggle to make ends meet, whether in or out of work.

“The £20 uplift to Universal Credit is a welcome boost helping to reverse some of the previous cuts, but it needs to be made permanent and extended to families who are still receiving benefits that preceded Universal Credit and are missing out on the increase.

“In addition, the Government needs to show families that it understands their ongoing need for stable and adequate support – not just in response to a global pandemic, but as tough times are often part of life for many families - for example by giving assurances about future upratings of benefits as prices increase.”

The reports made a number of recommendations aimed at improving the lives of families on low income.

Recommendations

  • We need as many people as possible to be in good, secure jobs, with stable and reasonable pay, that fit in with family needs. This would help make families less vulnerable to income shocks and help build financial resilience.
  • We need to strengthen the social security system so that it provides the anchor that people need in tough times. This requires adequate benefit levels.
  • We need to increase the amount of low-cost housing available for families on low-incomes and increase support for people with high housing costs, including low-income homeowners in times of difficulty. We also need to address the sense of insecurity felt by many people living in the private rented sector.
  • We need to address the digital divide with a renewed focus on digital inclusion, including access to devices, broadband and improved skills.
  • We need families to be able to access relevant and timely information, advice and support, for example with benefit claims, money and debt advice, access to food banks and health services, with provision for those who do not have the means or the ability to use online methods.

Mike Hawking, Head of Policy and Partnerships at the Joseph Rowntree Foundation, said: “A lack of good jobs, unaffordable and insecure housing, and an inadequate social security system were trapping people in poverty before COVID-19 hit.

“The pandemic has further exposed these problems, with those on low incomes bearing the brunt of the economic fallout – as the experiences of the families in this study show.

“As we embark on the long road to recovery it is vital that no-one is left behind. We need to see a focus on good jobs with secure contracts, fair pay, and opportunities to progress.

“Jobs where flexibility is the norm, so that work can fit around childcare and family responsibilities.

“We should all be able to rely on the social security system when times are tough, and the £20 weekly increase to Universal Credit during the pandemic has helped millions of families keep their heads above water.

“The government should urgently reconsider its decision to cut this lifeline in six months’ time – with the months and years ahead full of uncertainty, what families on low incomes need now is stability.”

ENDS

Notes for editors

Press release reference number: 21/40

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