UK Wealth Gap Widens: 52 Years’ Earnings to Reach Top 10%
It would take the average UK earner 52 years of full-time work to accumulate the same wealth as someone currently in the richest 10%, according to new research published today.
The findings, released by the Resolution Foundation, analyze the latest wealth and assets survey from the Office for National Statistics, covering the period 2020-22. The report reveals a significant increase in the wealth gap since the global financial crisis of 2006-08, when it took 38 years’ worth of earnings to reach the same threshold. The gap between median wealth and the wealth held by the top 10% has widened from £1m to £1.3m in real terms.
“Wealth gaps in Britain are now so large that a typical full-time employee saving all their earnings across their entire working life would still not be able to reach the top of the wealth ladder,” stated Molly Broome, senior economist at the Resolution Foundation and lead author of the report. The research also highlights low wealth mobility, meaning those born into wealth are likely to remain wealthy, and vice versa. Rising house prices and pension valuations since 2010 have primarily driven this widening gap, disproportionately benefiting older, property-owning households and exacerbating the intergenerational wealth divide.
While the share of total wealth held by the richest households has remained broadly stable since the 1980s, total wealth in the UK has surged, increasing from three times the annual GDP to almost 7.5 times. The pandemic saw household savings increase, but these gains were not evenly distributed; families in the highest income quintile saw liquid savings increase by £4,200, compared to just £80 for those in the lowest income quintile. This growing disparity has implications for social mobility and economic fairness, potentially fueling further inequality. You can find more information about wealth distribution from the Resolution Foundation.
Officials at the Resolution Foundation say they will continue to monitor wealth trends and advocate for policies aimed at increasing wealth mobility and reducing inequality.
