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Recession-Hit Rich Countries Suffer ‘Great Leap Backwards’ in Child Poverty – UN

Daniela Cojocaru (left) and Chiara Dimastromatteo, both 16, stand next to a graffiti-covered wall in Turin, Italy. Daniela is originally from Moldova. Chiara does not attend school and does not have a job.

Photo: UNICEF/Giacomo Pirozzi

28 October 2014 – Some 2.6 million children have sunk below the poverty line in the world’s most affluent countries since 2008, negatively impacted by the wave of recessions that rippled through their economies following the meltdown of blue chip financial intuitions, according to a new United Nations Children’s Fund (UNICEF) report out today.

“Many affluent countries have suffered a great leap backwards in terms of household income, and the impact on children will have long-lasting repercussions for them and their communities,” said Jeffrey O’Malley, UNICEF’s Head of Global Policy and Strategy in a press release.

The findings were published in a new report released by the agency, which ranks 41 countries in the Organisation for Economic Co-operation and Development (OECD) and the European Union according to whether levels of child poverty have increased or decreased since 2008.

The new Innocenti Report Card 12, Children of the Recession: The impact of the economic crisis on child well-being in rich countries, reveals that child poverty has increased since 2008 in 23 of 41 countries analyzed, bringing the total number of children in the developed world living in poverty to 76.5 million.

Report Card is the one UNICEF flagship publication devoted to children in the developed world. The new survey does not deliver many passing grades as it offers a sobering look at how child poverty has changed compared to fixed 2008 levels.

According to UNICEF, there is real concern that widening poverty gaps, young people not in education, employment or training and staggering declines in years of income progress are causing long term structural changes that will set children back significantly in the developed world.

The score card shows that rates were highest in the Mediterranean region, rising by more than 50 per cent in Croatia, Greece, Iceland, Ireland and Latvia. Indeed, in Greece in 2012 median household incomes for families with children sank to 1998 levels – the equivalent of a loss of 14 years of income progress. By this measure Ireland, Luxembourg and Spain lost a decade; Iceland lost 9 years; and Italy, Hungary and Portugal lost 8.

The report notes that in the United States, where extreme child poverty has increased more in this downturn than during the recession of 1982, social safety net measures provided important support to poor working families but were less effective for the extreme poor without jobs. Child poverty has increased in 34 out of 50 states since the start of the crisis.

Underscoring that the strength of social protection policies is a decisive factor in poverty prevention, Mr. O’Malley called on wealthy countries to “lead by example, explicitly committing to eradicate child poverty, developing policies to offset economic downturns, and making child well-being a top priority.”

He noted that while early stimulus programmes in some countries were effective in protecting children, by 2010 a majority of countries pivoted sharply from budget stimulus to budget cuts, leading to negative impacts for children.

“All countries need strong social safety nets to protect children in bad times and in good,” he stressed.

The report also found that child poverty actually fell in 18 countries, sometimes markedly. In particular, rates fell by about 30 per cent in Australia, Chile, Finland, Norway, Poland and the Slovak Republic.