Based on fresh analysis, the average worker in the UK would require 52 years' worth of salary to attain the wealth level of the wealthiest 10% in the country.
Widening Wealth Gap Across Decades
The analysis examined financial assets data covering the 2020-22 timeframe and determined that during 2006-08, it would have taken 38 years of median full-time earnings to join the top 10th of the wealth distribution.
An economic expert associated with the analysis observed: "Wealth gaps in Britain are now so large that a typical full-time employee saving all their earnings throughout their career would continue to be incapable to reach the top of the wealth ladder."
Measuring the Wealth Divide
The research discovered that the disparity between the wealth of the median citizen and someone in the wealthiest decile was one million pounds in the mid-2000s, but had expanded to 1.3 million pounds in real terms by 2020-22.
The economist added: "These differences are particularly worrying as financial progression in Britain is limited – individuals who begin life affluent tend to continue being rich, and conversely applies."
Proportional Economic Disparity
Despite the economic divide expanding in actual numbers, the portion of complete net worth in the UK held by the richest households – called "relative wealth inequality" – has been "largely unchanged since the 1980s," according to the research.
Over this timeframe, complete net worth in the UK rose substantially from three times the annual GDP, to approximately 7.5x.
Contributors of Wealth Inequality
So-called "passive" appreciation, via rising house prices and changes in superannuation evaluations, were the main drivers of the widening wealth gap from 2010 onward, according to the study.
These increases typically went to elderly homeowners, the study demonstrates – intensifying the age-based economic gap.
Intergenerational Economic Gaps
The average wealth gap between people in their early 30s and those in their early 60s more than doubled in real terms, from £135k in the mid-2000s, to £310k.
Regional Variations
Furthermore, the study revealed pronounced area-based disparities, with the average level of wealth in recent years standing at £290,000 in the southeastern region, where housing costs have generally grown substantially, versus £110k in the north-east.
Pandemic Period Effects
Throughout the COVID period, when millions of workers were supported by the taxpayer-backed furlough scheme, and pandemic lockdowns reduced expenditure possibilities, the data shows countless homes were in a position to set aside money, increasing their wealth.
Higher-income households fared much better, nevertheless. "The typical family in the bottom income bracket saw their available funds rise by merely £80 during the COVID years (across the pandemic timeframe), broadly the same as the 24 months before COVID. In contrast, the typical family in the top income bracket saw their liquid savings increase by £4,200," the report finds.
