I would sadly say yes, they are screwed for life if over the next few years they do not see that what they faced was neglect, and take opportunities to ensure that this doesn't change the entire course of expectation throughout their lives.
I was very rarely at school, was considered to be educationally challenged. It was never the expectation of my teachers that I would achieve much at all. I completed 2 days of year 10. I had sporadic home tutorage (I was ill so LEA provided but parents would make excuses for teachers to not come in as the house wasn't clean) left school with 3 gcses (D,E and G)
We were allowed our school clothes washed once per week, one bath per week.
We stunk, I didnt have things I needed. Had no school shoes, but had trainers which I wore all the time everywhere which had numerous holes (no socks, didn't know to cut my toenails)
My understanding was just that we were poor and my parents were doing their best, but I didn't know anyone who had as little as me, or was bullied for smelling like I did.
It didn't become obvious to me until I had DD that these were active choices that my parents made, and that if I had any chance at making anything of myself I needed to literally do the opposite of what they did.
The first step was to access education, there are local youth training schemes- that's how I managed to resit my GCSEs- got really good grades, then I went into further training to give me a chance of achieving a job that would pay more than Nat min wage.
I then looked into counselling to improve my self worth, it was a short course of about 10 sessions.
I placed an importance on cleanliness- to smell nice, personally and in my surroundings brings me a sense of happiness.
And I set about making a life for myself that included fun experiences- not just surviving as I'd always expected for myself.
If I hadn't have had the access to the training I wouldn't have had any chance of breaking the cycle.
I've been left with a lot of MH issues, and I don't think I will ever feel I truly belong anywhere because in my mind I'll always be that smelly, thick kid thst didn't fit it because I didn't have the right support, things or life experiences to fit in.
From the outside though, I look to be pretty successful, I have a life far removed from what anyone would believe I should have.
Please just nurture them into a direction where they can love themselves and strive for better, if not for themselves, for their future children.
In breaking the cycle, my child's upbringing is a stark contrast to mine. She has a lot of things I never dreamed of being able to provide her (whilst it brings me some pride, it doesn't matter so much) but she has a bathroom full of toiletries, and support to do well educationally. She has dreams and aspirations and is achieving academically in a way I never expected. She has had lots of foreign holidays. Her outlook of life is amazing, because the cycle of generational neglect was broken.