Empowering the Freelance Economy

Freelance economy could help get 4.5 million of the UK’s children out of poverty. But perhaps not with this government

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Despite the country’s relative affluence, over 4.5 million children in the UK are living in poverty, an issue that has worsened despite – or perhaps because of – government policies

A recent report by UNICEF, “Child Poverty in the Midst of Wealth,” has highlighted the alarming prevalence of child poverty in the world’s wealthiest nations, including the United Kingdom.

The report reiterates that child poverty goes beyond financial hardship, affecting children’s physical, mental, and emotional well-being. That is because poverty can hinder access to quality education, healthcare, and nutritious food, potentially impeding children’s potential and limiting their life opportunities.

The UK missed a golden opportunity

The Conservatives have been the UK’s governing party since 2010. Therefore, one should ask why from 2012 to 2019, when general prosperity presented countries with a golden opportunity to address child poverty some countries seized this opportunity, while others, like the UK, let it pass.

The top-ranked countries – those with the lowest rates of child income poverty combined with the greatest success in reducing child poverty – are Slovenia, Poland and Latvia. Poland, for example, reduced child poverty by 38 per cent. Slovenia, Latvia and Lithuania reduced it by more than 30 per cent.

In contrast, during this same period, the United Kingdom saw child poverty spike by 20 per cent.

Charities including the CPAG warn at least 800,000 children are living in poverty who are not eligible for free school meals, according to a Big Issue report.

Cash benefits

“To be eligible for free school meals, a household on universal credit in England must earn less than £7,400 a year (after tax and not including benefits),” the report said, highlighting that about 1.7 million children are in families poor enough to receive universal credit but are not eligible for free school meals.

Here is an excerpt from the UNICEF report:

Cash benefits, also known as cash transfers, to poor families are among the most immediately effective tools for tackling child poverty. During the recent period of
prosperity, some countries chose to increase cash benefits, while others reduced them.

Particularly remarkable efforts were made in Greece, Japan, the Republic of Korea, Poland and Türkiye. In the Republic of Korea, per child spending on cash benefits nearly tripled, from 3.1 per cent to 8.4 per cent of gross domestic product (GDP) per capita. In Poland, per child spending on cash benefits more than doubled from 6.6 per cent to 15.8 per cent. In both countries, child poverty decreased dramatically.

However, the amount countries spent on cash benefits did not depend on the size of their economies or the health of government budgets. Despite having more money available, Ireland, the United Kingdom and Mexico spent less on cash benefits in 2010 than in 2019.

How freelance opportunities can lift families out of poverty

In the UK, the rise of the freelance economy has emerged as a potential avenue to address child poverty. With the growing demand for skilled professionals in various fields, individuals are increasingly opting for freelance work, offering flexibility, autonomy, and the potential to earn higher incomes.

This shift towards freelance work presents a unique opportunity to support families struggling with child poverty. Parents who take on freelance work can often balance their professional commitments with caring for their children, reducing the need for external childcare expenses. Additionally, the freedom to set their schedules and work from home can alleviate the burden of traditional commuting costs, further contributing to household financial stability.

Diverse income streams

The freelance economy also opens doors to diverse income streams. Freelancers can tap into multiple projects simultaneously, diversifying their income sources and increasing their earning potential. This can be particularly beneficial for single-parent households or families where one parent is employed in low-wage positions.

Upskilling for career progression and earning power

Furthermore, the freelance economy offers opportunities for upskilling and professional development. Online platforms and educational resources provide access to valuable training and certifications, allowing freelancers to enhance their skills and command higher rates. This can lead to increased earning power and a stronger financial foundation for families.

Policies that embrace freelancing rather than constrict

However, to fully harness the potential of the freelance economy in alleviating child poverty, policy interventions are crucial. The government must implement measures to support freelancers, such as providing affordable childcare options and tax breaks. Educational initiatives should focus on equipping individuals with the skills and knowledge to succeed in the freelance marketplace from a working age.

Promising pathway to address child poverty

The freelance economy presents a promising pathway to address child poverty in the UK. By fostering an environment that supports and empowers freelancers, the government can play a pivotal role in ensuring that parents and their children have access to the opportunities they deserve to thrive and reach their full potential.

If you believe the freelance economy is a path to putting an end to child poverty in the UK please share this article and your comments.

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