Per fresh analysis, the average earner in the UK would need half a century of earnings to reach the net worth of the wealthiest 10% of the population.
Expanding Economic Disparity Over Time
This research reviewed financial assets data covering the Covid pandemic period and discovered that during 2006-08, it would have taken 38 years' worth of average worker salary to enter the wealthiest decile of the wealth distribution.
A research lead associated with the study observed: "Financial divides in Britain are presently so substantial that a average worker accumulating their complete salary throughout their career would remain unable to reach the top of the wealth ladder."
Assessing the Financial Disparity
The research discovered that the difference between the net worth of the average person and a person belonging to the top 10% was one million pounds in the mid-2000s, but had increased to 1.3 million pounds in real terms by the pandemic years.
The researcher added: "These gaps are particularly worrying as wealth mobility in Britain is low – people that start life affluent tend to continue being rich, and the opposite holds true."
Comparative Financial Divide
Even with the economic divide expanding in actual numbers, the percentage of overall assets in the UK held by the wealthiest families – known as "relative wealth inequality" – has been "mostly consistent since the 1980s," per the study.
Throughout these years, complete net worth in the UK surged from three times the gross domestic product, to almost 7.5 times.
Factors of Financial Divide
Termed "unearned" gains, via growing real estate costs and adjustments to superannuation evaluations, were the main drivers of the expanding economic divide from 2010 onward, per the report.
These appreciations generally flowed to older, property-owning households, the study demonstrates – worsening the generational financial disparity.
Age-Based Economic Gaps
The average wealth gap between individuals aged 30-34 and those in their early 60s increased over twofold in real terms, from £135,000 in 2006-08, to £310,000.
Regional Variations
Furthermore, the study revealed pronounced geographic differences, with the typical amount of wealth in recent years amounting to £290,000 in south-east England, where property prices have generally grown substantially, as opposed to £110k in the NE of England.
Health Crisis Years Consequences
Amid the health crisis, when countless laborers were covered under the taxpayer-backed furlough scheme, and pandemic lockdowns curtailed consumption options, the data shows countless homes were in a position to set aside money, enhancing their financial standing.
More affluent homes fared much better, though. "The median home in the bottom income bracket saw their liquid savings rise by merely £80 over the pandemic period (across the pandemic timeframe), broadly the same as the 24 months before COVID. On the other hand, the typical family in the wealthiest fifth saw their liquid savings grow by 4,200 pounds," the study reveals.
