Tag: wealth

Wealth growth outstrips salaries by three times

  • Average wealth has increased by 59% in the past decade while earnings have grown just 19%
  • Even among the wealthiest the value of assets has grown by 64% compared with 20% for salaries

The growth in average wealth from assets including property and investments has been three times higher than the growth in average earnings over the past decade, new analysis* from Handelsbanken Wealth & Asset Management shows.

Figures show people are being out-earned by their homes and other investments, with average wealth rising 59% over the past decade compared with 19% growth in salaries over the same period, according to Handelsbanken Wealth Management & Asset Management’s analysis of the latest Government data on Britons’ wealth and assets and earnings.

Average wealth for Britons is estimated at £575,948 after a decade of growth from £361,831, with house price rises as well as increases in pensions, investments and physical wealth including possessions all appreciating in value since 2010. By contrast, average earnings have only increased to £31,840.

For the wealthiest 25% of the population, the growth in assets has been even more impressive – they now own wealth estimated at £733,800 compared with £447,900 a decade ago. They have seen their wealth increase 34% faster than the British average, while their salaries have increased 22% faster.

Of course, the growth in wealth has not been shared equally throughout the country – the wealthiest people in London have seen their wealth grow by 77% over the period to an average £902,400, compared with £495,200 in 2010.

The top 25% wealthiest in the North East have only seen growth of 30% during the same period, taking them to an average £459,500, which equates to an increase of £105,300. Growth among the top quartile of wealthiest people in the South East was 77% during the same period, compared with 69% in the East of England and 66% in the South and Wales. The North West saw growth of 45%.

PK Patel, Head of Wealth Management at Handelsbanken Wealth & Asset Management, said: “Earnings growth has on average been constrained over the past 10 years, with most people relying on their houses, investments, and possessions to boost their wealth.

“It is fascinating to see the gulf between the increase in asset values and the increase in average earnings over the past decade, and is instructive for advisers and their clients on how to plan their finances and assess their wealth.

“No matter how your total wealth is made up, it’s important to have a clear plan on how you want to use it for your own future and for the benefit of other family members.”

Table one: wealth and salary growth for the richest quartile by UK region, 2008-10 vs 2018-20

RegionTop quartile average wealthTop quartile average salary
2008-102018-20Growth20102020Growth
North East£354,200£459,50030%27736.5£33,10819%
North West£387,400£561,40045%29272£35,25620%
Yorkshire & the Humber£376,300£556,30048%28591.5£33,89019%
East Midlands£415,500£617,90049%29442£35,20420%
West Midlands£399,200£621,50056%28654.5£35,00322%
East of England£511,500£864,70069%33006.5£38,93818%
London£495,200£902,40082%39157.5£47,42321%
South East£597,100£1,058,00077%34775.5£40,83417%
South West£485,300£805,50066%28887£34,43419%
Wales£383,900£635,70066%27845.5£33,45320%
Scotland£364,000£584,80061%30072.5£36,88923%
Great Britain£447,900£733,80064%31401£37,62520%

Table two: average wealth and salary growth by UK region, 2008-10 vs 2018-20

RegionAverage wealthAverage salary
2008-102018-20Growth20102020Growth
North East£271,385£382,37941%£22,566£27,34321%
North West£303,074£452,15149%£24,074£28,78220%
Yorkshire & the Humber£310,994£444,36643%£23,433£28,07220%
East Midlands£337,125£473,28440%£24,294£28,99719%
West Midlands£322,423£471,56446%£23,733£29,39924%
East of England£411,000£680,54966%£28,095£33,06518%
London£395,352£678,54572%£37,746£42,56513%
South East£491,410£827,56568%£29,940£35,04017%
South West£382,253£630,25865%£23,980£28,25818%
Wales£326,424£515,76758%£22,381£26,99521%
Scotland£301,504£464,68554%£24,527£30,09723%
Great Britain£361,831£575,94859%£26,751£31,84019%

Wealth in Scotland: the great divide

New statistics show average wealth remained stable while wealth inequality remained high.

According to the latest data from just before the pandemic, a typical household in Scotland had £214,000 in total wealth, similar to previous years. A typical household in the wealthiest 10% of households had £1.6 million in total wealth, whereas a typical household in the least wealthy 10% of households had £7,500.

The least wealthy households rarely own property or have any private pension savings. Their wealth is mainly made up of the value of their possessions such as cars, furniture and clothing.

Wealth inequality was more severe than income inequality: the 2% of households with the highest incomes had 9% of all income, while the wealthiest 2% of households had 15% of all wealth.

Households that tend to be wealthier than others are higher income households, pensioner couples, and home owners. In contrast, households with below average wealth tend to be low income households, lone parent and single working-age adult households, and those in rented housing.

Three out of ten households had insufficient savings to keep them above the poverty line for a month should they lose their income. Four per cent of households were in unmanageable debt. A third of households did not own any property, and a third of adults had no private pension savings.

The released figures were produced in accordance with professional standards set out in the Code of Practice for Official Statistics

The full statistical publication: Wealth in Scotland 2006-2020

Ten richest men DOUBLE their fortunes in pandemic while incomes of 99% of humanity FALL

New billionaire created every 26 hours, as inequality contributes to the death of one person every four seconds

The world’s ten richest men more than doubled their fortunes from $700 billion to $1.5 trillion – at a rate of $1.3 billion a day – during the pandemic while the incomes of 99 per cent of humanity have fallen with over 160 million people forced into poverty and inequality contributing to the death of one person every four seconds, an Oxfam report reveals today.

The report Inequality Kills, published on the opening day of the World Economic Forum’s Davos Agenda, finds that a new billionaire has been created every 26 hours since the start of the pandemic while the collective wealth of all 2,755 billionaires surged more than in the last 14 years put together. At $5 trillion dollars, this is the biggest increase in billionaire wealth since Forbes records began in 1987.

If the ten richest men were to lose 99.999 per cent of their combined wealth tomorrow, they would still be richer than 99 per cent of people on the planet and their wealth is six times more than that of the poorest 3.1 billion people.

The enormous rise in wealth is juxtaposed by a sharp increase in poverty around the world. Over 160 million more people are living on less than $5.50 a day than when the pandemic began. Inequality is now contributing to the death of at least 21,000 people each day, or one person every four seconds. This conservative finding is based on deaths globally from lack of access to healthcare, hunger, gender-based violence and climate breakdown.

Danny Sriskandarajah, Oxfam GB Chief Executive said: “The explosion in billionaire’s fortunes at a time when poverty is increasing lays bare the fundamental flaws in our economies.

“Even during a global crisis our unfair economic systems manage to deliver eye-watering windfalls for the wealthiest but fail to protect the poorest – it is an avoidable tragedy that every day people die because they lack essentials such as food and healthcare.

“Today’s generation of leaders can start to right these wrongs by implementing progressive taxes on capital and wealth and deploying that revenue to save lives and invest in our future. They should make sure that Covid-19’s long-term legacy is quality universal healthcare and social protection for all. Governments have an historic opportunity to back bold economic plans based on greater equality that change the deadly course we are on.”

The report also details how:

  • Developing countries, denied access to sufficient vaccines because of rich governments’ protection of pharmaceutical corporations’ monopolies, have been forced to slash social spending as their debt levels spiral and now face the prospect of austerity measures.
  • The pandemic has set gender parity back from 99 years to 135 years. Women collectively lost $800 billion in earnings in 2020, with 13 million fewer women in work now than there were in 2019. Over 20 million girls are at risk of never returning to school.
  • The pandemic has hit racialized groups hardest. During the second wave of the pandemic in England, people of Bangladeshi origin were five times more likely to die of Covid-19 than the White British population. In the US, 3.4 million Black Americans would be alive today if their life expectancy was the same as White people – a fact that is directly linked to historical racism and slavery.
  • Analysis of emissions by income group shows that over-consumption by the world’s richest people is one of the main drivers of today’s climate crisis. 20 of the richest billionaires are estimated, on average, to be emitting as much as 8,000 times more carbon than the billion poorest people.

Oxfam’s analysis showed that a one-off 99 per cent tax on the ten richest men’s pandemic windfalls alone would raise $812 billion and could fund:

  • Enough vaccines for the world
  • Universal healthcare and social protection, climate adaptation and gender-based violence reduction in over 80 countries
  • While still leaving these men $8 billion better off than they were before the pandemic.

Oxfam recommends that governments:

  • Urgently tax the pandemic gains made by billionaires and introduce permanent wealth and capital taxes, investing the trillions that could be raised on universal healthcare and social protection, climate change adaptation, and gender-based violence prevention and programming.
  • Immediately waive intellectual property rules over Covid-19 vaccine technologies to allow more countries to produce safe and effective vaccines to usher in the end of the pandemic.
  • Tackle sexist laws that discriminate against women and create new gender-equal laws.
  • End laws that undermine the rights of workers to unionize and strike and set up stronger legal standards to protect them.
Inequality Kills: The unparalleled action needed to combat unpreDownload

Wealth rising, but inequality remains high

New statistics released by the Chief Statistician show rising household wealth in recent years, while wealth inequality remained high.

According to the latest data, households in Scotland had just over one trillion pounds in personal wealth in 2016-2018. Recent wealth growth since 2010-2012 was caused mainly by rising pension wealth.

Wealth inequality was more severe than income inequality: the 2% of households with the highest incomes had 9% of all income, while the wealthiest 2% of households had 15% of all wealth. After a previous decline, wealth inequality has been largely stable since 2010-2012.

A typical household in the wealthiest 10% of households had £1.6 million in total wealth, whereas a typical household in the least wealthy 10% of households had £7,500.

The least wealthy households rarely own property or have any private pension savings. Their wealth is mainly made up of the value of their possessions such as clothing or furniture.

Households that tend to be wealthier than others are pensioner couples, married couples, home owners or households with higher formal qualifications. On the other hand, households that often have below average wealth are lone parent households, those in social rented housing, or where the head of the household is unemployed or economically inactive but not retired.

One third of households had insufficient savings to cover basic living costs for three months in the event of an emergency. Three per cent of households were in unmanageable debt. A third of households had no property wealth, and almost a fifth of households had no private pension wealth.

The released figures were produced in accordance with professional standards set out in the Code of Practice for Official Statistics.

The best of times, the worst of times?

Read the full statistical publication.