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More than a million key worker children to reach poverty in 2023

The number of children living in poverty in key worker households could reach 1.1 million by 2023, according to research from the Trades Union Congress (TUC).

The research showed 19% of key worker households have children living in poverty in 2022, an increase of over 65,000 households over the past two years to 989,000.

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The TUC warned that real-terms pay cuts for key workers are having a devastating effect.

Nurses’ real pay is expected to be down by £1,100 this year, while paramedics are taking a real-pay hit of over £1,500.

TUC general secretary Frances O'Grady warned the government's action so far risks steering the country towards recession.

She said: "Our amazing key workers got us through the pandemic. The very least they deserve is to be able to provide for their families. But the government is locking too many key worker households into poverty."

"Ministers’ heartless decision to hold down pay will cause widespread hardship and put the UK at greater risk of recession. After the longest wage squeeze in 200 years, we urgently need to get more money in the pockets of working families. This will help people get through this cost of living crisis and inject much-needed demand into our economy."

Consumer inflation reached a record high of 9.4% in the 12 months to June 2022 and energy prices have spiked in the past year.

On 4 August, the Bank of England raised interest rate from 1.25% to 1.75% increasing pressure on households already struggling with the cost of living.

Key worker families in the North East were found to have the highest rate of child poverty (41%), followed by the North West (29%), London (29%) and the east of England (24%).

In contrast, Scotland (8.3%) and Wales (8.9%) had the lowest rates.

Jane van Zyl, chief executive of charity Working Families, said it will be crucial for employers to take further steps to keep struggling parents in work.

Speaking to HR magazine, she said: "Flexible working is vital to enabling working parents and carers to access and stay in employment, which is a matter of survival during the cost of living crisis. Our research shows that the sectors that employ many of our frontline workers – healthcare, education, and transport – are among the least flexible in the UK.

"Flexible working should not just be the preserve of those who work at a desk – and working from home is just one of many types of flexible working. We encourage employers in every sector to take a look at all of the ways in which they can make flexible working possible. If employers get this right, they will reap the benefits of increased loyalty and retention."

Find out more about how HR can help in our Cost of Living Learning Hub.