Thinktank warns of massive rise in destitution in the wake of Covid-19

The wonders of capitalism: five million Britons predicted to become destitute this year.

Proletarian writers

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Proletarian writers

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An economic thinktank, the National Institute of Economic and Social Research, has warned that Britain will see a massive increase in the rate of destitution amongst the poorest workers as a result of the Covid pandemic and the 2020 economic crisis.

Its analysis suggests a 250 percent rise in destitution in Britain compared to levels in 2017, amounting to an rise from roughly 1.5 million to nearly 5 million people.

The thinktank uses data on mortality, unemployment and changes in wage income to calculate destitution, which it defines as “income that is so low that a household is likely to lack essential provision of shelter, food, heating, lighting, clothing/footwear and basic toiletries in the immediate future”.

The institute was already forecasting a rise of 133 percent in destitution for 2020 compared to 2017 before the pandemic began. Additional levels of destitution are attributed to the effect of the pandemic on the self-employed and to the increase in unemployment as the furlough scheme is wound down.

One study has suggested that up to half of British businesses will cut staff at the end of the furlough scheme.

The media are circulating unemployment predictions in the range of 10 to 15 percent of the workforce, but the true figure is likely to be much higher given the historic underreporting of unemployment in Britain.