Reasons why income and wealth inequality existsTrends in inequality in the UK

Income inequality in the UK narrowed until 1979 when it had fallen to 24% (0.24). It then increased dramatically to a 2010 peak of 36% (0.36). The UK’s current Gini coefficient increased from 34.4% to 35.7%, comparing the financial year ending 2022 with 2021.(Source: Office for National Statistics).

Income inequality trends

• In 2022, households in the top 20% of the population had an average disposable income of £83,687, whilst the bottom 20% of the population had an average disposable income of just £13,218. This means the richest 20% have 6.3 times more to spend or save as they wish than the poorest 20% of the population.
• According to the ONS, median (middle point) disposable income for the poorest 20% fell by 3.8% (to £14,500) between 2021 and 2022 but increased for the top 20% of people by 1.6% (to £66,000).
• In 2022, the top 20% of society had 36% of the income whereas the bottom 20% had only 9% of the total income.

Wealth inequality trends

• Oxfam reported in 2023, that the richest 1% of people in the UK held more wealth than 70% of the rest of the population together.
• The richest 50 families in the UK hold more wealth than the bottom 33.5 million people.
• If trends in income inequality continue, by 2035, the wealth of the richest 200 families will be larger than the whole UK Gross Domestic Product (GDP).
• Wealth inequalities tend to be wider than income inequalities.

Source: Equality Trust