Childhood circumstances have an important effect on a person’s future income prospects, analysis from ONS has shown.
The analysis suggests that people in the UK who have a low personal education level are nearly five times more likely to be poor in adulthood than those with high personal education levels, once other factors are accounted for.
Growing up in a workless household was also identified as an important factor in predicting future poverty.
For this analysis, poverty is measured in terms of relative low income; that is having a household income less than 60% of the UK median (average).
Find out how childhood circumstances affect your chances of future poverty
Use our calculator1 to find out how likely people with different childhood characteristics are to experience relative income poverty now:
Poor educational attainment and poverty
Educational attainment was the most important predictor identified of the likelihood that someone will be in poverty2 or severe material deprivation in adulthood. A low personal education level is itself associated with a number of other childhood factors.
After accounting for other factors, children of a father with a low level of education are 7.5 times more likely to have a low educational outcome themselves, compared with those who had a highly educated father.
A mother’s influence on their offspring’s academic future is also a factor; with a child three times as likely to have a low educational outcome if their mother had a low personal education level.
There is also a relationship between educational outcomes and the number of adults and children living in the household, the employment status of the parents and the household’s financial situation during childhood.
Childhood predictors of future poverty
People with a low personal education level are almost five times more likely to be in poverty now as those with high personal education levels, after accounting for other factors.
Growing up in a workless household also appears to have an impact. People who lived in a workless household at age 14 were around one and a half times as likely to be in poverty, compared with those where one adult was working.
When we take into account a person’s educational attainment, some other childhood factors such as the financial situation of the household when they were 14 are no longer significant predictors of current poverty.
This suggests that household income during childhood mainly impacts a person’s future income prospects through their educational attainment.
Severe material deprivation and educational attainment
Severe material deprivation3 provides an estimate of people whose living conditions are affected by not being able to afford items including being able to pay rent, mortgage and utility bills.
In the UK, after accounting for other factors, those with low personal education level are 11 times more likely to be severely deprived as those with a high level of education.4
Parental employment during childhood also factored into the likelihood of deprivation in later life. The odds of experiencing severe material deprivation now are almost twice as high for those whose father was unemployed, compared with those who worked in a managerial role.
Those who lived in a single parent household at age 14 are more than twice as likely to be severely materially deprived now as those who lived with both parents.
More information can be found in Intergenerational Transmission of Disadvantage in the UK and EU.
1.There may be other childhood characteristics which affect the chances of being in relative income poverty as an adult which were not possible to include in this analysis as data weren’t available. Other childhood factors that have previously been suggested which weren’t accounted for in this analysis include genetic ability, the quality and nature of early childcare, and the nature of the home environment more broadly.
2.For the purpose of this analysis, relative low income was used as an indicator of poverty. This means having an equivalised household disposable income; which takes into account a household’s size and composition, of less than 60% of the national median (average)
3.What is severe material deprivation?
The measure used in this analysis is that used by the European Commission as part of their Europe 2020 targets. Severe material deprivation is defined as being unable to afford at least four of the following nine items:
- To pay their rent, mortgage, utility bills or loan repayments,
- To keep their home adequately warm,
- To face unexpected financial expenses,
- To eat meat or protein regularly,
- To go on holiday for a week once a year,
- A television set,
- A washing machine,
- A car,
- A telephone.
This differs from child low income and material deprivation as measured in DWP’s Households Below Average Income publication.
4.What do low and high personal education levels or educational attainment mean?
Educational attainment in EU-SILC is reported using the International Standard Classification of Education (ISCED), which is maintained by the United Nations. The ISCED 1997 levels go from 0 (pre-primary education) to 6 (second stage of tertiary (e.g. PhD) level). Low educational attainment is defined throughout the analysis as reaching levels 0 to 2. [/footnote]