Activity 4: Economic (in)equality: Wealth and resources

Children born into low-income households are more likely to experience health problems from birth and accumulate health risks as they grow older. People in lower socioeconomic groups are also less likely to access healthcare. The relationship between poverty and ill-health is bidirectional: poverty contributes to ill-health and ill-health contributes to poverty.
Managing on a low income has a negative impact on maternal health and health-related behaviours. Infant mortality is higher amongst children born into poverty, who are more likely to be born early and have low birth weight. After birth, poverty is associated with postnatal depression and lower rates of breastfeeding.
Children from low-income households are more likely to experience problems with nutrition, which can have a negative influence on the mental well-being of children and over the longer-term can lead to childhood obesity. Poverty is also associated with anaemia, diabetes, asthma, cancer, lead-poisoning, neuro-developmental problems and poor dental health in childhood.
Low-income families are more likely to live in poor housing and children have fewer safe places to play. Poor housing is associated with a host of childhood health problems. Many studies connect growing up in low-income households with poor mental health. There is also evidence that poverty impacts on cognitive development.
Short-term health and developmental outcomes have longer-term implications. Those growing up in the poorest households are more likely to suffer poor physical and mental health in adulthood and are at increased risk of severe, long-term and life-limiting illness.
As well as healthcare spending, poor health creates costs for the economy through sickness absence and lower productivity.
Griggs & Walker (2008, p. 4).

A large body of evidence links childhood poverty with poor educational outcomes. Family background is the most important predictor of academic success. Children from low-income households have lower educational aspirations and are more likely to require remedial help or special educational needs assistance than their better-off peers.
Difficulties of access and expense limit participation in pre-school education amongst lower-income families. Young people from low-income households end up leaving school earlier and are around six times more likely to leave without qualifications than those from higher-income households. Children of non-manual workers are over twice as likely to go to university as those of manual workers. Educational outcomes are mediated by the home environment and parental influence.
Basic skills and formal qualifications are important for entry and progression in the labour market. Leaving education aged 16 into NEET status (not in education, employment or training) has been linked to later criminal activity, early parenthood, long-term unemployment and substance misuse. Moreover, educational disadvantage is likely to be transmitted to the next generation, with the children of low-skilled parents vulnerable to low educational attainment.
A work-force with lower skill levels, lower educational attainment and limited aspirations reduces productivity, economic growth and a country’s capacity to compete in a global economy.
Griggs & Walker (2008, pp. 4-5).

Given current policy priorities, one of the most significant outcomes of child poverty is the negative impact on later employment. The literature shows a strong relationship between growing up in a low-income household and labour market participation and progression in adulthood.
Young people who have grown up in low-income households are more likely than their more affluent peers to be unemployed, work in low or unskilled jobs and be poorly paid in adult life. The relationship between employment and childhood poverty persists even when educational outcomes and background are controlled for.
There is debate as to why worklessness appears to be passed from one generation to the next. Some see the poverty experience at the heart of this cycle, while others propose that negative employment outcomes stem from the model parents set for children.
Having a significant proportion of the population out of work is detrimental to the economy, reducing both productivity and competitiveness. NEET young people are costly in terms of benefits and lost taxes.
Griggs & Walker (2008, p. 5).

There is ongoing debate as to the impact of growing up in poverty on later behaviour. This review does not assume the correctness of one viewpoint over another.
An association between childhood poverty and behavioural outcomes is evident from an early age. Those growing up in low-income households have a greater likelihood of parent reported behaviour problems than their more affluent counterparts. They are also more likely to be excluded from school. Later outcomes include risk-taking behaviour, aggression, involvement in crime, poor health-related behaviours and suicide.
There remains disagreement over whether crime can be considered a product of childhood poverty. Context may be important in this respect, with US studies more likely to identify a direct relationship and UK research highlighting the complexity of the association. Most children raised in poverty do not become involved in crime, but there are higher victim and fear of crime rates in disadvantaged areas.
The relationship between childhood poverty and other behaviours such as smoking, drinking and drug use is also contested. The relationship between poverty and suicide is more firmly established, being closely associated with the higher incidence of mental health problems amongst those growing up in poverty.
Being involved in criminal activity whilst young has been shown to have a negative impact on later life chances. Furthermore, the children of young offenders are more likely to live in poverty themselves, reinforcing the ‘cycle of poverty’. High crime and fear of crime rates also have a negative impact on communities.
The social impacts of crime are substantial and far-reaching. They include considerable financial, emotional and time costs to victims. Economic costs of youth anti-social and criminal behaviour include the youth justice system, pupil referral units and other school-related services.
Griggs & Walker (2008, p. 5).

Intergenerational transmission of poverty means that a childhood spent in poverty increases the likelihood of being poor in later life. Most people remain in the same quarter of the income distribution as their parents. This effect remains even when other influential factors are accounted for. It is, however, difficult to establish causality in the intergenerational transmission of poverty.
Only a small number of studies have produced estimates of the overall cost of child poverty in OECD countries. Where they have, figures for the UK are around £40 billion a year. From an economic perspective, reducing child poverty is a fiscal investment; producing higher
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GDP, reducing expenditure on crime and healthcare and lowering the costs borne by victims of crime and those in poor health.
Griggs & Walker (2008, p. 6).

The association between childhood poverty and family relationships is complex, being interpreted in some studies as an outcome and in others as a mediator; good relationships buffering children from the negative impacts of poverty, bad ones reinforcing or even creating negative impacts of their own.
Living on a low income can affect the quality of parent-child relationships, but the relationship between poverty and parenting is often misunderstood. While there is evidence that poverty affects parents’ ability to manage stressful events, associations between poverty and physically punitive parenting are still contested. A correlation has been identified between family income and children being removed from their parents’ care.
The interaction of the numerous outcomes of poverty outlined here makes it difficult to disaggregate their effect on parenting. Evidence about parenting and poverty is, at times, contradictory. What is clear is that parents themselves feel that poverty affects their ability to care for their children.
Forming and maintaining friendships can be difficult for children living in low-income households. Problems with social contact may be reinforced where children live in an area with few accessible, safe places to meet and inexpensive leisure facilities. Difficulties with peer relationships limit the development of social capital, an important driver of adult social inclusion.
Growing up in poverty is also linked to lone parenthood and adolescent pregnancy. Having a child early in life can have a negative impact on the mother’s health and life chances, as well as those of her child.
Poverty can limit a family’s ability to become integrated into the local community and form social networks. Limited financial resources and low availability of safe, attractive areas may prevent neighbours meeting and socialising.
It is difficult to place even an approximate figure on what poverty might add to the cost of services for children and their families, but what should be considered in any calculation is the three billion pounds spent by local authorities each year on social services directed at children. Wider social costs associated with lower levels of community cohesion are impossible to quantify at present.
Griggs & Walker (2008, p. 6).

Subjective well-being is defined here as self-esteem and life-satisfaction. This has not been subject to the same level of research attention as the other areas discussed.
Poverty is known to affect children’s self-confidence and their relationships with other children. Young people living in low-income households report a stigma attached their circumstances, which impacts on school and community involvement. Children growing up in poverty are more likely to suffer from low self-esteem. In the longer-term, longitudinal datasets show a clear association between having been poor in childhood and reporting low levels of satisfaction with adult life.
The stigma identified by individuals can also be an issue for entire neighbourhoods. This is problematic because community relationships have an impact on the quality of people’s everyday experiences and extend beyond those living in disadvantaged communities to impact on wider society.
Griggs & Walker (2008, p. 6).