Linking the sectoral employment structure and household poverty in the United Kingdom

Structural changes in the labour markets of developed economies, and changes in their institutional characteristics, have led to growing unease about the nature of low-paid employment. Related concerns have been expressed about the persistence of low-pay, the fragmentation of work and the growth of under-employment. While all these factors have potential implications for individuals’ earnings, less is known about the connection between labour market change, patterns of sectoral growth and decline and household poverty outcomes. This article shows distinct patterns of poverty outcomes by sector of employment, after controlling for other factors. However, household characteristics, in particular the presence of a second earner, do strongly mitigate the poverty risk. Overall, the findings demonstrate that policymakers need to develop a coherent policy towards poverty that recognises the nature of jobs growth and the distribution of ‘good jobs’ across households.