4.2.1 Absolute and Relative Poverty

• Absolute poverty


  Living below subsistence, unable to meet basic needs of food, clean water, sanitation, health, shelter and education
• Absolute poverty measurement


  Number of people living on less than $1.25 per day (World Bank)
• Relative poverty


  Measured by comparison to average in the country, those with below 60% of median income considered in relative poverty (UK), basket of goods maintaining average standard of living (US)
• Relative poverty can be seen as one way of measuring income inequality
• Inequality in wages or unemployment

  Those with lower levels of education might struggle to find a job, and if they do, it might only be low paid
• More part-time and temporary jobs available rather than full time jobs


  Leaves people underemployed, limits how much they can earn
• Changing structure of the UK economy to services as a result of deindustrialisation


  Some jobs have been lost, causing structural unemployment and hysteresis (long-term unemployment)
• State pensions and welfare payments tend to increase less than wages

  Increases inequality and the number of people in relative poverty
• Some taxes are regressive in the UK


  Those on lower incomes bear a larger burden, increasing inequality and relative poverty
• Health issues


  Can make it hard to get a job, push people into absolute poverty
• Wars and conflicts


  Can push people to flee their homes, destroy livelihoods, force people into extreme poverty
• Corruption and political oppression

  Can lead to higher levels of relative poverty
• Natural disasters


  Can destroy people's livelihoods and push even more people into poverty