Per fresh analysis, the average earner in the UK would need 52 years' worth of earnings to attain the net worth of the wealthiest 10% nationwide.
Widening Economic Disparity Across Decades
This research analyzed net worth data from the Covid pandemic period and found that in 2006-08, it would have required 38 years' worth of median full-time earnings to enter the top 10th of the economic ladder.
An economic expert part of the report observed: "Wealth gaps in Britain are presently so substantial that a regular employee accumulating their complete salary during their working years would still not be able to attain the highest level of the financial hierarchy."
Assessing the Economic Gap
The study found that the gap between the assets of the average person and someone in the top 10% was one million pounds in the mid-2000s, but had increased to 1.3 million pounds in actual value by the pandemic years.
The economist further stated: "These gaps are especially alarming as economic movement in Britain is restricted – people that start life affluent tend to stay wealthy, and vice versa."
Proportional Economic Disparity
Although the wealth gap growing in actual numbers, the percentage of total wealth in the UK possessed by the most affluent homes – termed "proportional economic disparity" – has been "largely unchanged since the 1980s," per the research.
Throughout these years, overall assets in the UK rose substantially from thrice the gross domestic product, to almost 7.5 times.
Drivers of Wealth Inequality
Referred to as "passive" gains, via rising house prices and variations in superannuation evaluations, were the key contributors of the expanding economic divide from 2010 onward, per the report.
These gains tended to accrue to elderly homeowners, the study demonstrates – intensifying the intergenerational wealth divide.
Age-Based Wealth Disparities
The median economic difference between individuals aged 30-34 and those in their early 60s grew by more than 100% in actual value, from £135k in the mid-2000s, to 310 thousand pounds.
Area-Based Disparities
Furthermore, the study revealed pronounced regional variations, with the average level of assets in the pandemic period amounting to £290k in the SE of England, where housing costs have generally grown substantially, compared with £110,000 in the north-east.
Pandemic Period Effects
Amid the health crisis, when millions of workers were supported by the taxpayer-backed furlough scheme, and health crisis restrictions limited opportunities for spending, the data shows many households were able to save, increasing their wealth.
Wealthier families performed significantly better, nevertheless. "The median home in the lowest-income quintile saw their liquid savings increase by just £80 over the pandemic period (from 2019 to 2022), approximately equivalent to the pre-crisis period. Conversely, the median home in the wealthiest fifth saw their liquid savings increase by £4,200," the report finds.
