Mothers are still financially worse off after family breakups

Mothers in Britain who separate from their partners still experience a significant drop in their incomes, but the decline is markedly lower than it was a decade ago. That is the central finding of a new study, 'Marital Splits and Income Changes over the Longer Term', published yesterday by Professor Stephen Jenkins, director of the Institute for Social and Economic Research (ISER) at the University of Essex.

The change in the impact of marital splits on mothers' incomes seems to reflect rising rates of employment for women with children over the course of the 1990s and early 2000s. These were given a particular stimulus by the introduction of the working families tax credit (WFTC) in 1998, which both increased the incentives for those in workless families to find a job and helped make work pay.

Professor Jenkins's study also looks at the longer-term consequences of marital splits, and finds that, while women's family incomes do recover, they do not return to their pre-separation levels. In the fifth year after a split, incomes remain about 10% below pre-split levels on average.

The report analyses data from the British Household Panel Survey (BHPS), a representative sample of more than 10,000 adults in 5,500 households who have been interviewed about their lives every year since 1991.

The study found that marital splits are associated with sharp short-term declines in income for separating wives and children; whereas separating husbands are better off. However the size of the decline in income has got markedly smaller over time for mothers, as well as for dependent children. Between 1991 and 1997, the average decline in income for mothers between the year before and the year after the marital split was 30%. Whereas between 1998 and 2004, the average decline in income for mothers between the year before and the year after the marital split was 12%.

The report also considers how post-split incomes evolve over the longer term and reveals that the incomes of women with children do recover over the sequence of years after a split, but not to pre-split levels. In the fifth year after a split, incomes remain about 10% below pre-split levels on average.

To download a copy of the paper visit: http://www.iser.essex.ac.uk/pubs/workpaps/pdf/2008-07.pdf.