Economic composition and income volatility of Norwegian low-income families – a mixed method study of its implications

Abstract

Background: There is a growing amount of research literature documenting increasing social inequality and an increase in the number of children growing up in families with persistently low income in all Scandinavian countries. However, there is a research gap on the issue of income composition; what the main income sources of low-income families are in relation to the families’ position to the labour market and to the welfare state, and possible implications of this to the families’ potential to escape poverty. The aim of this study was to describe the complexity in income sources experienced by low-income families with and without immigrant backgrounds in Norway. Method: Families with children aged 0–17 years (N = 168 families) with low income and in need of long-standing welfare services participated in the New Patterns project. We used a parallel mixed-methods design with quantitative and qualitative research methods, using questionnaires, register data, individual and focus group interviews, workshops with family coordinators and ethnographic fieldwork. Results: Most parents included in the study had low education (51%) and a low proportion participated in the labour market (21%). Twenty different income sources or benefits that the families received were identified and no clear pattern of type of income sources that families received emerged. Families with immigrant background were more likely to receive basic subsistence benefits than non-immigrant background families, and there were corresponding small differences in employment status upon entering the New Patterns project. Several benefits are reduced if families receive other types of income and the interdependence between the various revenue sources increases the unpredictability of total family income. The families have varying degrees of economic literacy, practical finance skills and competence in managing bureaucracy. Conclusion: Income volatility and mechanisms in the Norwegian welfare system contribute to a poverty trap for low-income families who depend on benefits that are not work-related.