Recession has hit poverty and unemployment harder in Scotland than England

A new report published by the Joseph Rowntree Foundation (JRF) shows that not only is Scotland’s unemployment rate back to 1996 levels, but poverty is now hitting childless adults harder than pensioners or children.

Monitoring poverty and social exclusion in Scotland 2010, produced by the New Policy Institute, is JRF’s fifth assessment of poverty in Scotland. Built around a set of indicators and constructed using the latest official government data, the report assesses a wide range of indicators including unemployment, education, and health.

The research shows that:

    * Unemployment in Scotland has now surpassed that in England, having been markedly lower at the start of the recession.
    * In terms of employment, the recession’s impact was also bigger on men than women, with a shift from full- to part-time jobs.
    * Scotland’s child poverty rate rose by 2 per cent in the last year during the recession, compared with just 1 per cent in England.

However, the report does highlight the positive news that Scotland’s child poverty rate is still lower than England’s. With an average of 250,000 children in low-income households over the last three years, this is 100,000 lower than in the mid-1990s. As well as this, the average of 130,000 pensioners in low-income households over the last three years is just half what it was in the mid-1990s.

The number of working-age adults getting out-of-work benefits in Scotland rose1.4 per cent, from 539,000 to 589,000 from November 2007 to November 2009.

But across the country there were big variations, with 2007 rates just below 10 per cent in Aberdeenshire, Orkney and Shetland contrasting with 24 per cent in Glasgow City. The increases since then have tended to be worse where numbers were already highest, with much of the West of Scotland seeing increases over 2 per cent, while Aberdeenshire, Orkney and Shetland only saw small increases. Glasgow City and Dundee, however, appear to have bucked this trend and remained stable.

The report identifies areas in the Scottish Government’s anti-poverty programme that need improvement:

    * Essential services for low-income and other disadvantaged households;
    * Living standards for the nearly 600,000 working-age adults who receive out-of-work benefits; and
    * Help for those who have jobs but who still live below the poverty line.

The report concludes that where the Scottish Government has little direct control, its challenge is how to exercise influence both upward to the UK government and downwards to employers and service providers in Scotland.

Report author Anushree Parekh said: “Despite the disappointing rise in child poverty in the latest year, the overall impact of the recession on child poverty has been very mild – not least because of the rise in Child Tax Credits and Child Benefit that took place in 2008 providing almost £5 per week.”

Research co-author, and New Policy Institute Director, Dr Peter Kenway added: “Because of the welcome long-term falls in child and pensioner poverty, the composition of the low-income population is now very different from what it was in the mid-1990s, with working-age adults now accounting for 60 per cent of the total.

“Although the UK Government sets benefit, income tax and national insurance rates, the Scottish Government still needs to have explicit policy positions on these matters which are so crucial to poverty in Scotland.”

The Joseph Rowntree Foundation’s Chris Goulden said: “This study of poverty in Scotland highlights how vulnerable people and places in poverty are in periods of recession and the ensuing years. It will be important to ensure future growth in the economy includes reducing concentrations of low-skilled, low-paid work in Scotland and across the UK.”