Nearly two thirds of workers in ‘deep poverty’ before the coronavirus pandemic have since been furloughed, lost their job or had their hours or pay reduced, research suggests.
Some 65 per cent of 1,444 adults employed before the Covid-19 outbreak, and living on less than half of what they need to stay above the poverty line, have experienced a ‘negative labour change’, according to analysis from the Social Metrics Commission (SMC).
This compares to just over a third (35 per cent) of employed adults living more than 20 per cent above the poverty line prior to the crisis.
Many already in poverty could see their situation worsen, while those close to the poverty line could fall below it as a result of changing employment status, the report warns, leading to a ‘significant increase in poverty’.
The SMC analysed responses to a YouGov poll of more than 70,000 UK adults between March and May.
The report builds on its previous research published in July, which found that the proportion of the UK population in ‘deep poverty’ has risen more than a third from five per cent to seven per cent over the last two decades, while the overall poverty rate has remained largely unchanged.
This means there are 1.7 million more people living on less than half of what they need to stay above the poverty line compared to roughly 20 years ago.
Its latest report, Poverty and Covid-19, examined how coronavirus has affected respondents’ finances, attitudes towards society, experiences of loneliness and the extent to which they are confident about the future.
It found that a fifth of employees in deep poverty before coronavirus said they had since lost their jobs, compared to seven per cent of adults more than 20 per cent above the poverty line.
Those under or close to the poverty line were more likely to have been furloughed or seen their hours or wages cut during the crisis.
More than a third (36 per cent) of people at least 50 per cent below the poverty line said they had experienced this, compared to 22 per cent of those more than 20 per cent above the poverty line.
Eight per cent of people from a white ethnic background and employed before the crisis said they had lost their jobs, compared to 10 per cent of those from black, Asian and minority ethnic backgrounds.
More than half (56 per cent) of 18-to-24-year-olds working prior to the pandemic have experienced some kind of negative impact on their employment, compared to roughly a third of 25-to-54-year-olds previously working.
The worst-affected local authorities have seen up to 47 per cent of their workforce negatively affected.
The research also found the younger age group is more than twice as likely to report having become more lonely due to the pandemic than those aged 65 and over.
Almost a third (32 per cent) of people in deep poverty said they fear for their future, compared to 21 per cent of those who are more than 20 per cent above the poverty line.
For people living in all levels of poverty, a higher proportion felt the crisis is unifying society than dividing it, although this belief was stronger in those living above the poverty line.
Baroness Philippa Stroud, chairwoman of the SMC, said she was encouraged that people believe the crisis has united society.
She continued: “However, the findings also highlight the resilience gap between those living in poverty and those above the poverty line.
“In addition to financial struggles, our data shows that those in poverty were more likely to have felt lonely before lockdown began and are more likely to feel more lonely as a result of the crisis.
“Research has demonstrated the disastrous effects that loneliness can have on our physical and mental wellbeing, so it is important that the social and mental health challenges facing the most vulnerable are considered alongside economic ones as we build the road to recovery.”
Helen Barnard, acting director of the Joseph Rowntree Foundation, said: “In a society that believes in looking out for each other, it’s just not right that the groups already more likely to be trapped in poverty before the pandemic, such as disabled people and those of Black and Asian ethnicities, are those most likely to be pulled into even deeper hardship by the current economic crisis.”
A Government spokesperson said: “We know that this is a particularly difficult time for many on low incomes and have introduced a wide-ranging package of support to help as many people as possible.
“We’ve injected an extra £9.3 billion into the welfare safety net, including increasing Universal Credit by up to £1,040 a year.
“We have also launched a major effort to tackle loneliness and social isolation during the coronavirus outbreak.
“This includes a £5 million funding boost for national loneliness charities, relaunching the #LetsTalkLoneliness campaign, and publishing new public guidance on how to look after yourself and others safely.”
Picture: Archive photo, dated 06/01/14, of workers at a manufacturing company. UK manufacturers recently called on the Government to extend the job retention scheme by six months as they warned of job losses “on a scale not seen since the 1980s”. (Rui Vieira/PA).