Millennials more likely to face working-age poverty than past generations

Millennials are on track to face record levels of working-age poverty, new research claims.

The study by the Resolution Foundation called The Generation of Poverty, funded by the Nuffield Foundation, found that up to 22 per cent of people born between 1981 and 2000 are likely to be living in poverty by their late twenties.

That is higher than previous generations, the charity said.

Meanwhile, financial hardship among pensioners has fallen. The poverty rate for the “baby boomer” generation which is now entering retirement has fallen to 15 per cent – the lowest on record.

Their relative prosperity is partly down to early and affordable home ownership, said the charity.

While the study showed that baby boomers are generally less likely to face poverty in retirement than previous generations, it found that the minority of boomers living in private rented accommodation still face "very high poverty rates" of 35 per cent.

Fahmida Rahman, Researcher at the Resolution Foundation, said: “While almost half of the pre-war ‘greatest generation’ lived in pensioner poverty during the 1980s and early 90s, a combination of economic tailwinds and policy success has since helped to reduce pensioner poverty by two-thirds for the baby boomers entering retirement today.

“But while poverty risks are down for pensioners, they are rising for younger working-age people and their children. Children born today are more likely to face poverty at the start of their lives than any other generation over the last 60 years.

“Policy makers must turn their attention to supporting young families, and they can start by reversing benefit policies that are currently increasing the risks and depths of child poverty for our very newest generation.”