42

Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

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Page 1: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …
Page 2: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …
Page 3: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …
Page 4: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …
Page 5: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

0.0

0.5

1.0

1.5

2.0

0 100 200 300 400 500 600 700 800 900 1000 1100 1200 1300 1400 1500+

Nu

mb

er

of

ind

ivid

ua

ls (

mil

lio

ns

)

Income, £ per week, 2007/08 prices

Source: HBAI data

1.2 million

individuals with

income above

£1,500 per week

Mean, £487

Median, £393

Page 6: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

-2%

0%

2%

4%

6%

8%

10%

1980

1982

1984

1986

1988

1990

1992

1994-9

5

1996-9

7

1998-9

9

2000-0

1

2002-0

3

2004-0

5

2006-0

7

Re

al p

erc

en

tag

e in

cre

as

e

0.9% per year

avg. growth

Page 7: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

-2%

0%

2%

4%

6%

8%

10%

1980

1982

1984

1986

1988

1990

1992

1994-9

5

1996-9

7

1998-9

9

2000-0

1

2002-0

3

2004-0

5

2006-0

7

Re

al p

erc

en

tag

e in

cre

as

e

3.4% per year

avg. growth

0.9% per year

avg. growth

Page 8: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

-2%

0%

2%

4%

6%

8%

10%

1980

1982

1984

1986

1988

1990

1992

1994-9

5

1996-9

7

1998-9

9

2000-0

1

2002-0

3

2004-0

5

2006-0

7

Re

al p

erc

en

tag

e in

cre

as

e

Page 9: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

0% 1% 2% 3% 4% 5% 6% 7% 8% 9%

Total

Payments

Other

Savings

Self-emp

Benefits

Earnings

2001/02 to 2007/08 1996/97 to 2001/02

Source: HBAI data

66%

18%

10%

11%

3%

-7%

% of total

income

Page 10: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

-4%

-2%

0%

2%

4%

6%

8%

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009Pe

rce

nta

ge

in

cre

as

e o

n s

am

e m

on

thp

revio

us

ye

ar

Source: Average Earnings IndexSource: Average Earnings Index

Page 11: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

-4%

-2%

0%

2%

4%

6%

8%

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009Pe

rce

nta

ge

in

cre

as

e o

n s

am

e m

on

thp

revio

us

ye

ar

Source: Average Earnings IndexSource: Average Earnings Index

Page 12: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …
Page 13: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …
Page 14: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

-2%

-1%

0%

1%

2%

Poorest 2 3 4 Richest

Ave

rag

e a

nn

ua

l in

co

me

gro

wth

(%

)

Income Quintile GroupSource: HBAI data

Page 15: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

-2%

-1%

0%

1%

2%

Poorest 2 3 4 Richest

Ave

rag

e a

nn

ua

l in

co

me

gro

wth

(%

)

Income Quintile GroupSource: HBAI data

Page 16: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

-10%

-8%

-6%

-4%

-2%

0%

2%

4%

6%

8%

10%

10 20 30 40 50 60 70 80 90

Ave

rag

e a

nn

ua

l in

co

me

ga

in (

%)

Percentile point

Source: HBAI data

Page 17: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

-10%

-8%

-6%

-4%

-2%

0%

2%

4%

6%

8%

10%

10 20 30 40 50 60 70 80 90

Ave

rag

e a

nn

ua

l in

co

me

ga

in (

%)

Percentile point

Source: HBAI data

Page 18: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

-3%

-2%

0%

1%

2%

3%

4%

5%

10 20 30 40 50 60 70 80 90

Ave

rag

e a

nn

ua

l in

co

me

ga

in (

%)

Percentile point

Source: HBAI data

Page 19: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

-3%

-2%

0%

1%

2%

3%

4%

5%

10 20 30 40 50 60 70 80 90

Ave

rag

e a

nn

ua

l in

co

me

ga

in (

%)

Percentile point

Source: HBAI data

Page 20: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

-3%

-2%

0%

1%

2%

3%

4%

5%

10 20 30 40 50 60 70 80 90

Ave

rag

e a

nn

ua

l in

co

me

ga

in (

%)

Percentile point

Source: HBAI data

Page 21: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

-3%

-2%

-1%

1%

2%

3%

4%

5%

10 20 30 40 50 60 70 80 90

Ave

rag

e a

nn

ua

l in

co

me

ga

in (

%)

Percentile point

1979-1996/7

Source: HBAI data

Page 22: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

-3%

-2%

0%

1%

2%

3%

4%

5%

10 20 30 40 50 60 70 80 90

Ave

rag

e a

nn

ua

l in

co

me

ga

in (

%)

Percentile point

Source: HBAI data

Page 23: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

0.2

0.3

0.4

Gin

i C

oe

ffic

ien

t

Thatcher Major Blair/Brown

Source: HBAI data

Page 24: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …
Page 25: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …
Page 26: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

0%

5%

10%

15%

20%

25%

30%

1979 1983 1987 1991 1995 1999 2003 2007

60% AHC Median 60% BHC Median

Source: HBAI Data (FES and FRS)

Page 27: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

0%

5%

10%

15%

20%

25%

30%

1979 1983 1987 1991 1995 1999 2003 2007

60% AHC Median 60% BHC Median

Source: HBAI Data (FES and FRS)

Page 28: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

70% of

BHC

Median

60% of

BHC

Median

50% of

BHC

Median

40% of

BHC

Median

1996-97 Rate 28.1 19.4 10.6 4.3

Source: HBAI Data (FRS)

Page 29: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

70% of

BHC

Median

60% of

BHC

Median

50% of

BHC

Median

40% of

BHC

Median

1996-97 Rate 28.1 19.4 10.6 4.3

Labour I Change -0.8 -1.0 -0.1 +0.8

Source: HBAI Data (FRS)

Page 30: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

70% of

BHC

Median

60% of

BHC

Median

50% of

BHC

Median

40% of

BHC

Median

1996-97 Rate 28.1 19.4 10.6 4.3

Labour I Change -0.8 -1.0 -0.1 +0.8

Labour II Change -1.4 -1.4 -0.9 -0.2

Source: HBAI Data (FRS)

Page 31: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

70% of

BHC

Median

60% of

BHC

Median

50% of

BHC

Median

40% of

BHC

Median

1996-97 Rate 28.1 19.4 10.6 4.3

Labour I Change -0.8 -1.0 -0.1 +0.8

Labour II Change -1.4 -1.4 -0.9 -0.2

Labour III Change +0.6 +1.3 +1.3 +1.1

Source: HBAI Data (FRS)

Page 32: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

70% of

BHC

Median

60% of

BHC

Median

50% of

BHC

Median

40% of

BHC

Median

1996-97 Rate 28.1 19.4 10.6 4.3

Labour I Change -0.8 -1.0 -0.1 +0.8

Labour II Change -1.4 -1.4 -0.9 -0.2

Labour III Change +0.6 +1.3 +1.3 +1.1

2007-08 Rate 26.5 18.3 10.8 6.0

Source: HBAI Data (FRS)

Page 33: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

0.0% 1.0% 2.0% 3.0% 4.0% 5.0%

Non-working couple, 3 children

Non-working Lone Parent, 1 child

Part-time working Lone Parent, 1 child

Single Adult on JSA

Single Adult on IB

Single Pensioner on Pension Credit

Basic State Pension

Source: HBAI data

RPI inflation

4.1%

BHC Poverty

Line

4.3%

Page 34: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

0%

5%

10%

15%

20%

25%

30%

1979 1983 1987 1991 1995 1999 2003 2007

Source: HBAI Data (FES and FRS) and authors’ analysis

Children

Working age with children

Working age no children

Pensioners

Page 35: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

0

0.5

1

1.5

2

2.5

3

3.5

4

1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020

Ch

ild

ren

(m

illi

on

s)

Child poverty

Page 36: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

0

0.5

1

1.5

2

2.5

3

3.5

4

1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020

Ch

ild

ren

(m

illi

on

s)

Child poverty Progress to date Required path Projected

2010 Target looks challenging

Page 37: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …
Page 38: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

1980 1984 1988 1992 1996 2000 2004

Pensioners AHC Pensioners BHC

Source: HBAI Data (FES and FRS)

Page 39: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

1980 1984 1988 1992 1996 2000 2004

Pensioners AHC Pensioners BHC

Source: HBAI Data (FES and FRS)

Number of pensioners

living in poverty now:

2.0 million (AHC)

2.5 million (BHC)

Page 40: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

1980 1985 1990 1995 2000 2006

60% of AHC Median 60% of BHC Median

Source: HBAI Data (FES and FRS)

Page 41: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …
Page 42: Poverty and Inequality During Previous Recessions ... · Basic State Pension Source: HBAI data RPI inflation 4.1% BHC Poverty Line 4.3%. 0% 5% 10% 15% 20% 25% 30% 1979 1983 1987 …