Job losses and parental anxiety about the economy are likely to have a major impact on children's happiness, a charity has warned.
Children in households reporting a drop in income over the past year were more than twice as likely to experience low levels of happiness as those in homes where income had risen, research for the European Children's Society has shown.
Of those in households where income increased, 7pc reported low levels of well-being, as opposed to 15pc in households where income had fallen.
Where income had not changed, 10pc reported low levels of happiness.
The research conducted between October and last month into thousands of children aged from eight to 15 years old and their parents showed parental worry about the state of the economy had an impact on children's happiness.
Bob Reitemeier, chief executive of Britain's Children's Society, said: "Today's findings are deeply concerning. As the spending cuts take hold, the well-being of our children is under threat. The consequences are likely to hit the most vulnerable children hardest.
"We fear that they will pay a life-long economic and social price for political decisions."