Probably one of the single most important elements of a child's origins that affect their development and subsequent life chances is the family's economic circumstances. Clearly, these circumstances rest on a number of interlocking characteristics: their economic activity status; the socioeconomic classification of any employment; their qualification levels; the number of resident parents; and their health. These elements combine to identify whether families live in poverty or in plenty. Since 1997, the government has made the reduction of child poverty a central policy target. These Millennium Cohort children are directly in line to be the target for this set of policies. This first sweep gives us a measure of children living in poverty at the start of their lives. Future sweeps will show whether those who start out in poverty continue to live in this state, and to what extent their parents manage to escape poverty. In this chapter, therefore, we review parents’ socioeconomic circumstances at nine months in order to see the starting out point for these children.

In Britain, socioeconomic differentials in birth outcomes are wide and appear to be growing. Babies born to families in social classes IV and V have higher infant mortality and morbidity rates, and lower birthweights, than babies born to families in social classes I and II (ONS, 2003). Class differentials in infant mortality, after narrowing up to 1998, have since then been growing (DWP, 2003). Poverty-related health inequalities in early years have been found to affect children's physical and intellectual development in the long term (Gregg et al, 1999; Bradshaw, 2001).

The first sweep of the Millennium Cohort Survey (MCS) offers the opportunity for a new and more up-to-date investigation of the relationship between poverty and childbirth. This chapter sets out to:

• • describe an important set of the socioeconomic circumstances of Millennium babies at the start of their lives;

• • derive measures of poverty and social exclusion from the range of questions asked in the survey;

• • estimate the proportion of babies born to women who were poor during their pregnancy and/or childbirth – including an estimate of those who were born to women receiving Income Support (IS); and

• • estimate the role of employment in keeping families out of poverty.

Other associations of living in poverty are considered in Chapter 4.