The impact of the COVID-19 pandemic on poverty in working households in Aotearoa New Zealand As a consequence of the COVID-19 pandemic, there is a significant risk that poverty in working households in Aotearoa New Zealand will be further exacerbated beyond the reported rates in the NZWRI Research.3 While it is too early to tell what the full extent of the impacts will be on New Zealanders, we can hypothesise about a number of areas of concern which will affect poverty in working households throughout Aotearoa in both the short and long term, including those most affected and who may need targeted assistance during the COVID-19 recovery phase. These aspects warrant further investigation and research if we are to truly understand the impact the pandemic has upon the current state of poverty in working households in Aotearoa New Zealand and the steps required to address these. It is not just the economic impacts that are relevant here. While the impacts of the government responses and fiscal stimulus measures will have a significant impact, so too will the increased levels of stress on individuals and families, and the social aspects of the pandemic response. Monitoring and understanding both the economic and social impacts of COVID-19 is vital for informing the Government’s policy responses. The pandemic has heralded a particularly uncertain future for some industries. While widespread wage subsidies have softened the immediate blow for many, the unemployment rate is expected to rise and our GDP growth rate is forecast to decline. Essential workers have continued working (often working longer hours than normal) and many working at reduced pay rates, and there is a vast disparity between the experiences of those working through the pandemic lockdown. Those working households who are already statistically more likely to experience poverty are in many cases those who have maintained the economy (and our health systems) throughout lockdown. 6 Human Rights Responses to Poverty in Working Households Low wage industries (those that employ workers lower on the ‘occupational hierarchy’) are among those worst hit by the pandemic-induced economic shutdown. Industries particularly impacted include tourism, accommodation and food services, where significant numbers of jobs will be lost over the next year as Aotearoa New Zealand’s borders remain closed. The industries most heavily impacted by the pandemic are some of those with higher than average numbers of workers experiencing poverty prior to the pandemic. These industries have a high proportion of staff on casual or temporary contracts, which make them more susceptible to be a working household in poverty or to become unemployed. Those living in working households already experiencing poverty are among those most likely to be disproportionately affected by the economic outcome relating to the pandemic. Those who can least afford it will be those who suffer the most from this crisis. This highlights the need for targeted responses and measures to ensure that the pandemic does not result in a spike in poverty in working households in Aotearoa New Zealand. Likely increases in the poverty figures for working households are expected, due to reduced hours and, consequently, incomes for many who remain in work. As shown in the NZWRI Research, the number of hours worked plays a role in explaining the poverty status of households. We expect to see an increase in the labour market underutilisation rate and reductions in the average hourly time earnings rate, despite the recent gradual increases in minimum wages. A reduction in the labour force participation rate is also a likely outcome. Women have been affected more than men, and women are usually more likely to be affected by impacts such as loss of working hours and withdrawal from the labour market. This has most severely impacted Māori and Pacific women.