Meet The Working Poor: One Million Australians Are Living In Severe Poverty

One million Australians are living in severe poverty, according to research released today.

Severe income poverty is defined as having access to household income of less than 30% off the national median.

About 5% of Australia’s population is in this category.

More than 310,000 children are also living in households in severe poverty.

A lone person in poverty typically has no more than $133 to live on each week after deducting housing costs, with many surviving on even less.

A couple with children makes do with income of $261 each week after paying rent.

Falling through the Cracks is the first in the new Focus on the States series released by the Bankwest Curtin Economics Centre (BCEC) in Perth to coincide with Anti-Poverty Week.

Using the latest household income data, economists focussed on measuring how deeply groups of Australians have fallen into disadvantaged circumstances and what factors exacerbate the incidence and depth of poverty.

Alan Duncan, the economics centre director, says the report adds a perspective to the national debate around income poverty by examining just how deeply income poverty extends throughout Australian households.

Professor Duncan says a significant proportion of households are in severe poverty despite relying on wages and salaries as their main source of income.

This highlights the existence of a sub-population of working poor.

Compared to national averages, Queensland and NSW are over-represented in the proportion of households in severe poverty.

More than one-quarter of a million people are in severe income poverty in Queensland, and 380,000 people in NSW.

Taken together, the two states constitute more than half of all households in severe poverty in Australia.

“Being single, either with or without children, plays a central role in increasing the risk of being in poverty, especially if they are below retirement age,” Professor Duncan said.

Those who are unable to enter the housing market are particularly vulnerable, with the overall poverty rate for renters in Australia more than twice that for mortgage holders (22.6%) compared with 10%) and three times the rate for owners without mortgages (at 6.8%).

Around 2% of lone renters aged less than 35 are in poverty, but the rate rises to nearly four in 10 for lone persons aged 35 to 54, and more than one in two for those approaching retirement age.

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