According to fresh analysis, the average worker in the UK would have to work over five decades of earnings to achieve the wealth level of the richest 10% in the country.
Growing Financial Divide Across Decades
The study examined net worth information including the Covid pandemic period and determined that during the pre-financial crisis era, it would have needed 38 years of average worker salary to join the richest segment of the economic ladder.
An economic expert part of the study observed: "Economic disparities in Britain are now so large that a average worker accumulating their complete salary during their working years would still not be able to reach the top of the financial hierarchy."
Quantifying the Economic Gap
The study revealed that the difference between the wealth of the average person and an individual in the wealthiest decile was £1 million in 2006-08, but had widened to £1.3m in actual value by 2020-22.
The researcher continued: "These differences are doubly concerning as economic movement in Britain is restricted – those who commence life wealthy tend to stay wealthy, and vice versa."
Comparative Financial Divide
Despite the financial disparity expanding in specific figures, the portion of complete net worth in the UK held by the wealthiest families – termed "relative wealth inequality" – has been "mostly consistent since the 1980s era," per the research.
Throughout these years, overall assets in the UK increased dramatically from triple the yearly economic output, to nearly seven and a half times.
Factors of Economic Disparity
Termed "passive" gains, via growing real estate costs and variations in retirement fund assessments, were the primary factors of the widening wealth gap from 2010 onward, according to the report.
These gains generally flowed to elderly homeowners, the study demonstrates – intensifying the age-based economic gap.
Generational Financial Divides
The average wealth gap between individuals aged 30-34 and sixty-somethings more than doubled in actual value, from £135,000 in the mid-2000s, to £310k.
Geographic Differences
Additionally, there were significant area-based disparities, with the average level of wealth in recent years reaching £290,000 in the SE of England, where property prices have tended to rise rapidly, as opposed to £110k in the north-east.
Pandemic Period Consequences
Amid the health crisis, when millions of workers were protected by the public-funded employment protection, and pandemic lockdowns curtailed consumption options, the data shows countless homes were capable of accumulating, growing their net worth.
Wealthier families performed significantly better, though. "The median home in the lowest-income quintile saw their available funds increase by just £80 throughout the health crisis (across the pandemic timeframe), approximately equivalent to the two years pre-pandemic. Conversely, the average household in the top income bracket saw their liquid savings increase by £4,200," the report finds.
