More children are now living in poverty despite both parents working full time, according to new research from the Institute for Public Policy Research (IPPR) and Action for Children. The study reveals a fundamental shift in the nature of poverty in the UK, with almost three-quarters of children in poverty living in working households in 2024/25, up from around half at the turn of the century.
Key findings
Around 430,000 children across the UK are believed to be at risk of poverty in households where every adult is in full-time employment. The impact is particularly acute for children in single-parent families. For couples, the likelihood of child poverty in working families has tripled since 2000 – from 2 per cent to 6 per cent – while for single parents, it has risen from 9 per cent to 14 per cent. Children in single-parent families also fall into poverty at twice the rate of those in couple families.
Structural barriers
More than half of families who were able to bring in a second income moved above the poverty line, the study found. However, researchers said many families struggle to do this because of structural barriers including high childcare costs, limited availability outside of term time, inflexible jobs, and a lack of informal support.
Henry Parkes, principal economist and head of quantitative research at IPPR, said: "Parents are doing everything we’ve asked of them – working full time and juggling childcare – yet many are still watching their children grow up in poverty. That’s not a failure of individual families, it’s a sign the system is no longer delivering on its basic promise."
Call for reform
The IPPR is calling on the government to overhaul the benefits system and expand access to flexible, family-friendly roles. Lucy Schonegevel, director of influencing, policy and campaigns at Action for Children, said: "At Action for Children we see many families who are working as hard as they can, balancing jobs with caring responsibilities, yet still struggling to make ends meet. We would like to see more practical measures to help working families to progress in the labour market and increase their earnings. This should include fixing the many issues with Universal Credit childcare support, piloting an enhanced progression offer for parents on Universal Credit and strengthening the work allowance to improve work incentives - particularly for second earners and single parents."
Government response
A government spokesperson said: "We have doubts about some of the statistics in this report. For example, some mix two different versions of poverty statistics that cannot be directly compared in this way, meaning the conclusions drawn are misleading. Our efforts to turn the tide on poverty after years of rising hardship are making a real difference - household incomes have risen 5 per cent in real terms, around 100,000 fewer children are in deep material poverty and food bank usage has fallen. In addition, our landmark Child Poverty Strategy will lift 550,000 children out of poverty in 2030 and we’re helping drive down the cost of living, by raising the National Living Wage and the first ever sustained above inflation increase to Universal Credit."
