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Income and Wealth Inequality in the UK

Asked about the income inequality in their country, over 80% of Britons said they feel like the gap between rich and poor is too great. This is not only an impression as it’s also proven by scientific research: according to data from the Office for National Statistics, the richest 1% of households in the UK hold more wealth than over half of the country’s population, and the gap is continuously rising. Another worrisome fact is that 6.5 million households in the UK don’t have enough savings to last them for 1 month.

More so, the social mobility is quite limited in the UK, with 50% of a parent’s pay advantage being passed onto their children compared to just 15-25% in Nordic countries. This means that inequality is inherited by children from their parents and the family income has a big impact on a child’s future. Only a disruption of this trend can give children the possibility of a better life even if they come from a family of low income. The inequality of opportunity is what drives income inequality further and further.

Wealth inequality is at such high level in the UK that the annual increase in wealth of the richest 1,000 people in Britain (£28.508 billion) could pay 20 years’ worth of grocery bills for all of the UK’s users of food banks or it could pay a year’s rent for over 3 million households. It would also be enough to buy houses for all homeless people living in London or pay 10 months’ worth of energy bills for all 25.6 million British households.

Inequality in the UK has increased substantially in the course of the past 40 years. Between 1979 and 2000, income inequality increased by about 40% and in the late 2000s the Gini coefficient reached its highest historical level (0.36). Moreover, the growth of inequality in the UK has been faster than that of any comparable industrial country.

As one might expect, income inequality also affects access to healthcare, impacting life quality and longevity. A UNICEF research shows that nearly one in five UK children under the age of 15 suffers from food insecurity, meaning their family lacks secure access to sufficient, safe and nutritious food. More so, one in three UK children are in what UNICEF calls “multi-dimensional poverty”, which measures deprivation in a number of areas linked to children’s rights including housing, clothing, nutrition and access to social and leisure activities. These deprivations are strongly linked to death rates among children from low income families.

The most unequal UK areas

According to a study conducted by the New Economics Foundation that measured “wellbeing inequality”, UK areas with the biggest gaps between those who are struggling and those who are satisfied with life are: Blaenau Gwent, Liverpool, Neath Port Talbot, Merthyr Tydfil, Knowsley, Sunderland, Rotherham, Kingston Upon Hull, Inverclyde, North Ayrshire. Coincidentally or not, most of these are areas where industries have closed, leaving people unemployed and struggling to meet ends on a daily basis. On the other end of the line, UK areas with the smallest differences between people’s wellbeing are Enfield, Cheshire East, Harrow, Eileen Siar, Orkney and Shetland, Warwickshire, Wokingham, Falkirk, Lambeth, Aberdeenshire, Barnet.

What famous British people say about inequality

No society can surely be flourishing and happy, of which the far greater part of the members are poor and miserable.” (Adam Smith, political economist and moral philosopher)

Our inequality materializes our upper class, vulgarizes our middle class, brutalizes our lower class.” (Matthew Arnold, essayist)

The outstanding faults of the economic society in which we live are its failure to provide for full employment and its arbitrary and inequitable distribution of wealth and incomes.” (John Maynard Keynes, economist)

A State divided into a small number of rich and a large number of poor will always develop a government manipulated by the rich to protect the amenities represented by their property.” (Harold Laski, political theorist)

Poverty is an anomaly to rich people. It is very difficult to make out why people who want dinner do not ring the bell.” (Walter Bagehot, economist)

A solution

Figuring out how to tackle rising inequality is one of the key challenges of our time. There are many political platforms that promise a more equal world and many economists work on proposing different solutions to this crucial problem. With WowApp, you can take the income inequality fight in your own hands. By using WowApp, you earn what’s rightfully yours from activities that you were before doing for free: chatting with friends, playing online games, shopping online, simply unlocking your phone and many more. A part of your daily earnings is automatically donated to a charity of your choice and it’s your decision whether you also donate the rest of your earnings or you cash out the money for yourself. Either way, you do good in the world and help stop the rising trend of income inequality. Find out more about WowApp and Wowism here.