A further fall in the number of households where no-one is in work shows the success of tax credits, according to unions.
Official figures revealed t hat the proportion of households without work has fallen from 20.9% in 1996 to 15.8%.
Around 3.3 million households were classed as workless between April and June this year, compared with 3.9 million in the same period in 1996, reported the Office for National Statistics (ONS).
The proportion of children living in workless households has fallen from 19.8% to 11.8%.
The ONS said the increase in working households has been partly driven by more lone parents in work.
The share of lone parents in jobs has risen from 43% in 1996 to 64%.
TUC general secretary Frances O'Grady said: "The proportion of children in workless households has almost halved since 1996. This tells you all you need to know about the incredible success of tax credits in making work pay and supporting childcare costs.
"And it should act as a warning to the Prime Minister and Chancellor not to rush ahead with severe cuts to tax credits that would put work incentives at risk."
Fiona Weir, chief executive of campaign group Gingerbread, said: "Once again it is inspiring to see that despite the difficulty of juggling work with raising children on your own, 64.4% of single parents are in employment.
"However, despite the rise, single parent families remain nearly twice as likely to be in poverty as those in couple parent families.
"A fifth of single parents working full time earn so little they are still raising their children in poverty, and more than a quarter of children in working single parent families were in poverty in 2014.
"So although more single parents are working, the likelihood that they are working and bringing their family up in poverty remains persistently high.
"And this situation is set to become even more precarious if the Government presses ahead with its cuts to tax credits, which are a lifeline to many single parents who struggle to make ends meet."
Andrew Hunter, co-founder of jobs site Adzuna, commented: "The long-term fall in the share of workless households and the drop in the number of workless households over the last 12 months is the result of an increase in both the number of good solid jobs being created and a rise in the amount of zero-hour contracts available, particularly in fast-paced industries such as food and retail.
" It's worth remembering that there are subtleties at play here, too. For instance, while worklessness in the South East is low the story is very different in the North East and Northern Ireland - this is not a homogenous picture."
Work and Pensions Secretary Iain Duncan Smith said: "These figures show that under this Government the number of children living in workless households has fallen by nearly 500,000 - to its lowest ever rate.
"My priority is to ensure that no-one is left behind as our economy grows. There is no better example of welfare reform working than giving children the aspiration and economic security that comes with living in a household where people are in work.
"Our welfare reforms are at the heart of finishing our long-term economic plan - to end worklessness and ensure that hardworking people have security at every stage of their lives."