New ONS data reveals that inequality has not fallen over the past two decades

New ONS analysis published today (Tuesday), which uses new data on those with high incomes to improve the accuracy of its income statistics, shows that inequality has not fallen over the past two decades, did rise in the run-up to the crash, and has been flat since the crisis.

Commenting on the new ONS analysis, Adam Corlett, Senior Economist at the Resolution Foundation, said:

“Poor data on the incomes of the very richest households has meant that the UK’s inequality story has often been incomplete.

“This has also led to commentators and politicians making misleading claims about inequality falling in 21^st century Britain. Today’s innovative new data shows these claims are untrue.

“By better capturing the incomes of the very richest in society we can see that inequality rose dramatically in the run-up to the crash, fell in the midst of the crisis, and has been broadly flat since. Critically, the big picture for Britain has been consistently high levels of inequality that have not fallen outside of financial crises.

“The challenge for policy makers going forward is to reduce inequality, with growth that is shared across all incomes groups and all parts of the country.”

Notes to Editors

• The ONS economic review is available here.
• Former Chancellor Philip Hammond has previously used ONS data to claim in November 2017 that “income inequality is at its lowest level in 30 years”
• The ONS’ top income adjustment today brings its inequality data more into line with the DWP’s Households Below Average Income (HBAI) data series. For more on why we need better data to give us a richer understanding of inequality across the UK, read this recent Resolution Foundation report – Unequal Results – by Senior Economist Adam Corlett.