Round the clock: In-work poverty and the hours question
Posted on 29 Apr 2015 Categories: Blog
by Rethinking Poverty
Low-paid parents can be helped to overcome the greater barriers they face in striking the right balance for their families between work and parenting through better childcare support, more responsive employers and a stronger and more effective social security system, according to a report published today by Child Poverty Action Group (CPAG) commissioned by the Webb Memorial Trust.
The research – Round the clock: In work poverty and the hours question – based on polling of 4000 members of the public, focus groups with 20 parents and interviews with employers – finds a strong desire among parents to work and a recognition that low income parents face a number of barriers to achieving the right mix of home and work life.
- Low pay
- High childcare costs and a lack of out of school childcare and
- High ‘marginal tax’ rates within in-work benefits– for example, under Universal Credit, once earning above their ‘work allowance’, families lose 65p of benefits for every extra pound earned (76 pence if they are also paying tax and NI)
Nearly two thirds of poor children have at least one working parent. While the number of children living in poor households has followed a downward trend since the late 1990s, the proportion of poor children with a working parent has increased significantly over this time. In 1997/98, for example, fewer than a half of children living in poverty had at least one parent with a job; by 2012/13, this figure had risen to close to two-thirds.
Asked what hours it was reasonable to expect parents to work in order not to be poor, four thousand respondents offered a plurality of opinions: and the wide range of responses given were uncorrelated to gender, social class, voting intention or age.
Traditional gender patterns (i.e. one full-time earner and one part-time caring parent) were evident in the polling, but twenty nine per cent of those polled thought it reasonable to split working hours equally between both parents.
A majority (57%) thought it unreasonable to ask parents to work unpredictable hours. And, across the board, the median time for a reasonable commute to work was considered to be half an hour, compared to the 90 minutes currently expected of jobseekers receiving benefit.
Parents in the study’s focus groups – across all income groups – were reluctant to prescribe the number of hours parents should work. Most viewed the decision as a personal choice, depending on children’s needs, availability of childcare and jobs and parents’ values. There was a strong consensus among parents that those on lower pay should be able to strike the same work-family balance as higher earning parents.
But in practice, low-earning parents face growing pressure to increase their hours. From this month, Universal Credit pilots are requiring couples on the minimum wage and with school-age children to look for up to 51 hours of work between them, compared to the current 24 hours required for tax credits claimants; the ‘in-work conditionality’ pilots begin in the North West.
Businesses involved in the CPAG study on the whole accepted the need to be flexible with employees with caring responsibilities and most tried to give staff a degree of flexibility in their hours. But the higher the skill level of the employee, the more likely employers were to meet requests for flexibility. And low-skilled, low-paid work tended to go hand in hand with more sporadic and unpredictable hours of work. In addition, many parents wanting more hours find it difficult to find them.
CPAG’s report recommends a range of changes to help low-income parents achieve the right family/work balance for them, including:
- Improvements in childcare, particularly out of school childcare and in help with the costs of it
- Reform of universal credit including enabling parents to keep more of their benefit as earnings rise
- Introduction of a strategy on low pay to ensure businesses which can afford to, pay the living wage. And beyond that, ensuring the minimum wage is eventually set at the level of a living wage.
- Ensure parents are not required to accept zero or low hours contracts
- Restoration of the value of children’s benefits to their pre-2010 levels
- Training for jobcentre advisers on parental employment so they better understand the factors that determine parents’ choices and develop sensitive work-search requirements
- Greater emphasis on work-progression (with a view to higher earnings and the avoidance of in-work poverty rather than the blunt requirement to increase working hours )
- Greater clarity and more detail in benefit-related regulations, e.g. on what constitutes good reason for not taking a job under UC.
Commenting on the findings, Chief Executive of Child Poverty Action Group Alison Garnham said:
“Low-income parents are under growing pressure to work their way out of poverty and free of benefits. But simply pushing parents to clock up more hours is not a possibility for every family so won’t in itself solve in-work poverty. Nor will it allow families time to get on with the valuable task of parenting. Our report shows families need a mix of support.
“Parents in this study told us loud and clear that they want jobs and will work more hours providing they can get the balance right between work and family life. Low earning parents need change on a number of fronts, including affordable, quality childcare, decent pay and tailored support towards work progression. Time away from the workplace raising children should be viewed as a social good not a luxury for those on high incomes. ”
Barry Knight, Director of the Webb Memorial Trust, said:
“This report highlights the importance of considering all three variables when discussing solutions to in-work poverty: hours worked, levels of pay and levels of in-work benefits. A comprehensive
strategy to tackle all three aspects of in-work poverty is what is desperately needed. Employers have a leading role to play in tackling the causes of in-work poverty and must come forward with some of the answers.”
Posted on 29 Apr 2015 Categories: Blog