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Based on new analysis, the median employee in the UK would require over five decades of income to achieve the wealth level of the wealthiest 10% in the country.

Expanding Wealth Gap Over Time

The study examined net worth data covering the 2020-22 timeframe and discovered that in the mid-2000s, it would have needed 38 years' worth of median full-time earnings to join the top 10th of the financial hierarchy.

A research lead part of the report observed: "Financial divides in Britain are now so large that a typical full-time employee saving all their earnings throughout their career would still not be able to reach the top of the financial hierarchy."

Quantifying the Economic Gap

The research found that the difference between the assets of the typical individual and a person belonging to the top 10% was £1 million in the mid-2000s, but had increased to 1.3 million pounds in inflation-adjusted terms by recent times.

The analyst continued: "These disparities are particularly worrying as financial progression in Britain is limited – those who commence life well-off tend to continue being rich, and conversely applies."

Proportional Economic Disparity

Although the financial disparity widening in absolute terms, the percentage of total wealth in the UK possessed by the richest households – known as "comparative financial divide" – has been "broadly stable since the 1980s era," according to the analysis.

Over this timeframe, total wealth in the UK surged from triple the yearly economic output, to almost 7.5 times.

Contributors of Economic Disparity

Referred to as "passive" gains, through rising house prices and adjustments to superannuation evaluations, were the primary factors of the expanding economic divide since 2010, according to the study.

These gains generally flowed to elderly homeowners, the research shows – intensifying the intergenerational wealth divide.

Generational Financial Divides

The average wealth gap between individuals aged 30-34 and sixty-somethings more than doubled in inflation-adjusted terms, from £135,000 in the mid-2000s, to £310,000.

Geographic Variations

There were also pronounced geographic differences, with the median value of net worth in recent years standing at £290k in the southeastern region, where real estate values have tended to rise rapidly, compared with £110k in the NE of England.

Pandemic Period Impact

Amid the health crisis, when numerous employees were protected by the government-supported job retention program, and health crisis restrictions curtailed consumption options, the data shows numerous families were capable of accumulating, increasing their wealth.

More affluent homes fared much better, however. "The typical family in the poorest fifth saw their liquid savings grow by only eighty pounds during the COVID years (across the pandemic timeframe), roughly identical to the pre-crisis period. In contrast, the typical family in the highest income quintile saw their liquid savings increase by £4,200," the study reveals.