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Growing Inequality Triggering Child Poverty in Affluent Nations

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By Rodrigo Pérez | IDN-InDepthNews Analyis

GUADALAJARA, Mexico (IDN) - A new landmark report, released here the same day as the Royal Swedish Academy of Sciences announced that Professor Angus Deaton was awarded the 2015 Nobel Prize in economics, seeks to deepen understanding of the impact of income inequality on children.

While Deaton was awarded for his work in "consumption, poverty and welfare," the report published on October 13 by the 34-nation Organisation for Economic Co-operation and Development (OECD) looks at child well being for the first time.

One child in seven in world’s 34 rich nations lives in poverty, finds the report, adding that children on the whole are paying a high price for today’s growing income inequality.

In October 2014, a report by the United Nations Children’s Fund (UNICEF) found that 2.6 million children had sunk below the poverty line in the world’s most affluent countries since the crisis fist broke in 2008, bringing the total number of children in the developed world living in poverty to an estimated 76.5 million.

Titled How’s Life?, it shows how children from more affluent backgrounds tend to have better health and a happier school life. However, children from less well-off families find fewer of their classmates kind and helpful. They are more likely to be bullied at school, says the report.

Children from poorer background lag far behind in terms of life satisfaction, reading and problem-solving skills, communication with parents and intentions to vote in national elections in later life, notes the report.

“Growing inequality among parents ends up sapping opportunities available to their children,” says the report in a warning that might sound like a commonplace wisdom.

The report also shows the extent to which some children are getting a better start in life than others.

“Income poverty affects one child in seven in OECD countries, while 10 percent of children live in jobless households. Since the economic crisis, child poverty rates have risen in two thirds of OECD countries. In most OECD countries, the poverty rate for children is higher than for the population in general,” states the report.

Presenting the report at the 5th OECD World Forum on Statistics, Knowledge and Policy in Guadalajara, Mexico, OECD Secretary-General Angel Gurría said, “Policies will fail to build a better society if they do not take into account the needs of all of its members – particularly the very young. The fight against inequality begins by ensuring that everyone enjoys opportunities to thrive in life, especially from an early age.”

The report also provides the latest evidence on well-being among the wider population, including changes in well-being over time, inequalities in well-being outcomes among different groups, and critical resources that will shape well-being in the future.

Importance of volunteering

The report highlights the importance of volunteering, finding that it makes a significant contribution to well-being – both for society at large and for volunteers themselves. Unpaid, socially useful work for the community produces goods and services that are not captured by conventional economic statistics, and whose value amounts to around 2 percent of GDP (Gross Domestic Product) on average in the OECD.

“The OECD’s work on well-being is providing essential insights into whether we are succeeding in delivering better and more inclusive growth. This report broadens our understanding of progress by focusing on people and the quality of their lives, not just on whether GDP is going up,” said Gurría.

How’s Life? finds that where you live, how old you are, and whether you are a man or a woman are also among the factors that affect your well-being. The data show:

Gaps in well-being between regions in a country can be as large as differences between OECD countries. For example, regional employment rates in Italy range from 40 percent in Campania to 73 percent in Bolzano, which is similar to the difference between Greece (49 percent) and Iceland (82 percent).

Intergenerational inequalities can be stark. The steep increase in long-term unemployment that has occurred since 2009 has disproportionately affected young people. However, people under 30 are more likely than those aged over 50 to feel they have friends or relatives they can count on in troubled times.

Men and women face different types of risks to their personal safety. In the majority of OECD countries, men have a higher risk of death due to assault than women. However, women often feel much less safe than men when walking alone at night in the area where they live.

Indicators of work-life balance show that 1 in 8 employees in the OECD work very long hours (50 or more per week). Full-time workers in France, Spain, Denmark, Belgium, Norway and Germany enjoy at least an hour a day of leisure more than those living in the U.S., Poland, Canada and Australia.

Where you live also affects the quality of the air you breathe.  An estimated 42 million people across the OECD area are exposed to air pollution levels well in excess of both WHO and EU air quality guidelines.

The report is part of the OECD Better Life Initiative launched in 2011 to measure well-being and progress beyond traditional metrics such as GDP. Another component of the Initiative, the Better Life Index, allows users to compare countries according to their own vision of what constitutes well-being. [IDN-InDepthNews – 13 October 2015]

Graphic: OECD

2015 IDN-InDepthNews | Analysis That Matters

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