A quarter who escape poverty are poor again in two years

Almost a quarter of people who lifted themselves out of poverty are poor again one or two years later, according to a stark new analysis by the Brotherhood of St Laurence's Research and Policy Centre.

Dealing with poverty in the past has included distributing free milk to school children, as this historic photograph from the Brotherhood of St Laurence's archives shows.

Dealing with poverty in the past has included distributing free milk to school children, as this historic photograph from the Brotherhood of St Laurence's archives shows.

The new study identifies Australians who are more vulnerable to falling into poverty — including older people and the long-term unemployed — and are more likely to remain poor, or churn in and out of poverty. 

Our researchers, Dr Francisco Azpitarte and Dr Eve Bodsworth, found that among those who experienced poverty, more than 35 per cent of those who escaped it did not become poor again over 11 years, the time period analysed by the study. On the other hand 12 per cent were still poor after the 11 years had passed.

Dealing with poverty in the past has included distributing free milk to school children, as this historic photograph from the Brotherhood of St Laurence's archives shows.

Dr Azpitarte said: "Poverty is relatively short-lived for many Australians who experience it, but for some groups it can be persistent.

"In particular older Australians, the long-term unemployed, people with limited education, households where no-one has a job, households where at least one member has a disability — not just individuals with disabilities themselves — and people living in highly disadvantaged areas are more likely to remain poor. 
"Even if they are able to leave poverty they are more likely to become poor again, and the longer people remain in poverty, the less likely they are to escape it." 

The Brotherhood's research, 'Persistent Disadvantage', is a chapter in a major new report, "Addressing entrenched disadvantage in Australia", published by the Committee for Economic Development of Australia (CEDA).

Our researchers used data from the longitudinal Household, Income and Labour Dynamics in Australia (HILDA) Survey of more than 7000 households to use an approach to measuring poverty that traces individuals and households over time. They also measured not only income, but other factors including health, employment status and education.

The study says further investigation is needed to understand the factors that enable some households to move out and stay out of poverty. The "poverty churn" for some households points to the need to look at ways not only to assist people out of poverty, but also to safeguard against them returning to it.
The Brotherhood of St Laurence also uses the HILDA Survey for an innovative approach to measuring social exclusion over time, developed with the Melbourne Institute of Applied Economic and Social Research, called the social exclusion monitor.

Read more about the research »

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