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Low income dynamics.

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M2 PRESSWIRE-31 August 2004-UK Government: Low income dynamics(C)1994-2004 M2 COMMUNICATIONS LTD

RDATE:08312004

Coverage: Great Britain Theme: Social and Welfare

The Low Income Dynamics statistical paper, based upon results from the British Household Panel Survey (BHPS) for the period 1991 to 2002, is published today on the DWP website: http://www.dwp.gov.uk/asd/hbai.asp

The paper analyses the movements around the income distribution by individuals over the period 1991-2002, and examines the extent to which individuals living in low-income households are persistently experiencing low income, on both Before Housing Costs (BHC) and After Housing Costs (AHC) bases. The AHC estimates have been included for the first time in the paper. The report also contains new tables showing the likelihood, for different groups, of making a transition either into or out of low income; and identifies events and characteristics which are associated with the transitions.

Key results for the different analyses are as follows:

Tables on income mobility on the BHC measure show that:

* Between 1991 and 2002, there was considerable income mobility. For example, if the population is divided into five groups (quintiles) of equal size, ranked by income, around five per cent of the population remained in the same quintile of the income distribution for the whole of the period. There was less mobility for people who started in the top quintile as they were more likely to stay there throughout the period than those in any other quintile.

* Around half of individuals who were in the bottom or top quintile in 1991 spent seven or more years in that particular quintile from 1991 to 2002. Individuals in any of the middle three quintiles were less likely to have spent the majority of their...