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According to recent research, the average worker in the UK would need over five decades of income to attain the financial standing of the most affluent 10% in the country.

Growing Wealth Gap Over Time

This research reviewed wealth distribution information from the Covid pandemic period and discovered that during 2006-08, it would have taken 38 years' worth of typical employment income to reach the top 10th of the financial hierarchy.

A senior economist part of the study commented: "Wealth gaps in Britain are now so large that a regular employee saving all their earnings during their working years would remain unable to reach the top of the economic scale."

Quantifying the Economic Gap

The analysis found that the disparity between the net worth of the median citizen and someone in the richest segment was £1 million in the pre-crisis period, but had widened to £1.3m in inflation-adjusted terms by 2020-22.

The economist continued: "These disparities are particularly worrying as economic movement in Britain is restricted – those who commence life well-off tend to remain affluent, and conversely applies."

Comparative Financial Divide

Even with the economic divide widening in absolute terms, the share of total wealth in the UK possessed by the richest households – called "comparative financial divide" – has been "broadly stable since the 1980s era," per the study.

During this period, complete net worth in the UK rose substantially from three times the gross domestic product, to approximately 7.5x.

Drivers of Wealth Inequality

Referred to as "automatic" gains, via rising house prices and variations in pension valuations, were the key contributors of the widening wealth gap over the past decade, as stated in the report.

These appreciations typically went to senior citizens with real estate, the analysis reveals – worsening the intergenerational wealth divide.

Generational Economic Gaps

The typical financial disparity between thirty-somethings and sixty-somethings grew by more than 100% in real terms, from £135,000 in the mid-2000s, to £310k.

Area-Based Variations

Additionally, there were pronounced area-based disparities, with the typical amount of wealth in 2020-22 amounting to 290 thousand pounds in the southeastern region, where real estate values have typically increased quickly, as opposed to £110,000 in the north-east.

Pandemic Period Effects

Throughout the COVID period, when numerous employees were covered under the public-funded employment protection, and pandemic lockdowns curtailed consumption options, the statistics indicate numerous families were able to save, increasing their wealth.

Wealthier families performed significantly better, though. "The median home in the lowest-income quintile saw their liquid savings grow by only eighty pounds over the pandemic period (from 2019 to 2022), approximately equivalent to the 24 months before COVID. In contrast, the median home in the wealthiest fifth saw their available funds increase by £4,200," the study reveals.