According to new analysis, the median worker in the UK would require 52 years' worth of salary to achieve the net worth of the most affluent 10% in the country.
Growing Wealth Gap Through the Years
This research reviewed financial assets statistics including the Covid pandemic period and found that back in 2006-08, it would have required nearly four decades of average worker salary to reach the richest segment of the economic ladder.
An economic expert involved with the study observed: "Financial divides in Britain are presently so substantial that a average worker setting aside their entire income across their entire working life would remain unable to attain the highest level of the wealth ladder."
Quantifying the Financial Disparity
The study revealed that the difference between the net worth of the median citizen and someone in the wealthiest decile was £1m in the pre-crisis period, but had expanded to 1.3 million pounds in inflation-adjusted terms by the pandemic years.
The economist further stated: "These differences are especially alarming as wealth mobility in Britain is low – people that start life well-off tend to remain affluent, and vice versa."
Comparative Financial Divide
Although the economic divide widening in actual numbers, the percentage of total wealth in the UK possessed by the richest households – known as "comparative financial divide" – has been "mostly consistent since the 1980s," according to the research.
Throughout these years, complete net worth in the UK surged from thrice the annual GDP, to nearly seven and a half times.
Factors of Economic Disparity
Termed "passive" increases, through increasing property values and variations in retirement fund assessments, were the main drivers of the growing financial disparity from 2010 onward, according to the study.
These increases typically went to elderly homeowners, the analysis reveals – worsening the generational financial disparity.
Age-Based Wealth Disparities
The average wealth gap between thirty-somethings and sixty-somethings increased over twofold in inflation-adjusted terms, from 135 thousand pounds in pre-financial crisis, to 310 thousand pounds.
Geographic Differences
Additionally, there were pronounced regional variations, with the median value of assets in the pandemic period standing at £290,000 in south-east England, where property prices have generally grown substantially, compared with £110,000 in the northeastern region.
Health Crisis Years Impact
Amid the health crisis, when countless laborers were protected by the public-funded employment protection, and health crisis restrictions limited opportunities for spending, the data shows numerous families were in a position to set aside money, growing their net worth.
Wealthier families achieved superior outcomes, however. "The median home in the poorest fifth saw their available funds grow by only eighty pounds during the COVID years (from 2019 to 2022), roughly identical to the 24 months before COVID. In contrast, the typical family in the wealthiest fifth saw their available funds increase by £4,200," the report finds.
