Table 1. Overview of key differences in how in-work poverty is measured internationally
Bureau of Labor Statistics
(USA)
Eurostat (EU)
ILO
Definition of Working
Activity Status
Working or looking for
work
Worker
Worker
Amount of work
>6 months per year
>6 months per year
At least 1 hour per
week
Income before taxes and
tax credits
Anchored (US Official
Poverty Line)
Net income equivalised by
‘modified’ OECD scale
Per capita
expenditure
Relative (60% median income)
Absolute ($1.25/day)
Definition of Poverty
Income Concept
Thresholds
Source: Lohmann 2018.
Lohmann (2018) does point to one important commonality between the definitions presented in
Table 1: he notes that “all define an in-work poor person as a working person who lives in a poor
household” (2018, p. 7). This results in the two concepts of work and poverty having inconsistent
units of analysis (that is, the individual versus the household).
To show the significance of this inconsistency, it is worth illustrating this measurement issue with a
specific example. Imagine a family or household comprises one man, one woman and two dependent
children. The woman is in employment and the man is not; the children, aged three and seven, are
too young to work. The family is living in poverty. In the approaches presented in Table 1 (regardless
of definition adopted), only the woman would be counted as experiencing in-work poverty, since only
she is working. Her partner and their children are dropped from the enquiry since they do not work.
When it comes to thinking about the policy responses to tackle in-work poverty, we are implicitly
pushed towards thinking about how to address her poverty, rather than trying to assess and ensure
income adequacy for the whole household. Proposals to tackle in-work poverty prevalence are
therefore likely to focus on her level of pay (hence why the debates regarding in-work poverty and
low pay are often conflated) or perhaps on encouraging her to undertake additional hours of paid
work. The former is particularly problematic as the international literature demonstrates with great
consistency that the relationship between low pay and in-work poverty is weaker than assumed (Marx
et al., 2012; Maȋtre et al., 2018; see also Bennett, 2014 for a discussion). The strength of the
relationship depends crucially on whether there are other income sources in the household in
addition to the earnings of the low paid member and how extensive the household’s needs are.
There are other ways the hypothetical household described above may escape poverty besides
options focussed solely on the female worker. For instance, her partner might return to work so that
there would be two earners in the household. Or, if he were unable to do so because he is taking care
of the younger child, the government could help via increasing access to childcare. In short, by
focussing solely on the individual worker, we run the risk of ignoring the fact that policy solutions
focussed on the non-working members might help the household escape poverty.
Examples of studies that do employ consistent units of analysis in relation to the work and poverty
variables are few and far between. Of note are a few recent UK studies (Tinson et al., 2016; McInnes
et al., 2013; Hick & Lanau, 2017) that focus on all working-age adults living in households (who meet
the relevant definition of experiencing poverty and having someone who is in employment), not just
the workers. Further, as will be shown in Section 3, our approach also utilises consistent units of
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