Based on fresh analysis, the typical worker in the UK would have to work 52 years' worth of income to attain the financial standing of the wealthiest 10% in the country.
Widening Wealth Gap Across Decades
This research reviewed financial assets data from the Covid pandemic period and found that during the mid-2000s, it would have needed 38 years' worth of typical employment income to reach the wealthiest decile of the economic ladder.
A research lead part of the analysis commented: "Economic disparities in Britain are currently so significant that a regular employee saving all their earnings across their entire working life would still not be able to attain the highest level of the wealth ladder."
Measuring the Financial Disparity
The study found that the gap between the net worth of the average person and an individual in the top 10% was £1 million in the pre-crisis period, but had widened to 1.3 million pounds in inflation-adjusted terms by recent times.
The researcher added: "These differences are doubly concerning as financial progression in Britain is low – individuals who begin life affluent tend to stay wealthy, and the opposite holds true."
Proportional Economic Disparity
Despite the economic divide expanding in specific figures, the portion of total wealth in the UK possessed by the most affluent homes – called "relative wealth inequality" – has been "largely unchanged since the 1980s era," according to the study.
During this period, total wealth in the UK surged from three times the yearly economic output, to nearly seven and a half times.
Contributors of Economic Disparity
Termed "automatic" appreciation, through increasing property values and adjustments to retirement fund assessments, were the key contributors of the growing financial disparity since 2010, according to the analysis.
These gains typically went to elderly homeowners, the analysis reveals – worsening the intergenerational wealth divide.
Generational Wealth Disparities
The typical financial disparity between individuals aged 30-34 and those in their early 60s grew by more than 100% in inflation-adjusted terms, from £135k in the mid-2000s, to £310k.
Regional Variations
Additionally, there were pronounced regional variations, with the median value of net worth in the pandemic period standing at £290k in the SE of England, where housing costs have tended to rise rapidly, versus 110 thousand pounds in the NE of England.
Pandemic Period Impact
During the pandemic, when millions of workers were covered under the government-supported job retention program, and health crisis restrictions limited opportunities for spending, the data shows countless homes were capable of accumulating, increasing their wealth.
More affluent homes performed significantly better, nevertheless. "The typical family in the lowest-income quintile saw their available funds grow by only eighty pounds over the pandemic period (from 2019 to 2022), roughly identical to the pre-crisis period. In contrast, the median home in the wealthiest fifth saw their available funds increase by £4,200," the report finds.
