The UK is relatively unequal amongst the richer G7 nations, whether assessed by income or asset wealth. Income inequality rose here in the 1980s and has remained reasonably stable since then.
Wealth inequality, similarly, started to increase in the 1980s and has continued to do so steadily ever since. Meanwhile, attitudes to inequality of income and wealth distribution are shifting (see sustainability – social concerns; and corporate governance).
Around the world, opportunities for skilled work may increase while creating division between those with access to high-speed internet connection and other technology necessary for such work and those without such access (see technology - communications). The drivers of change influence inequality but, conversely, the interconnectivity of nations means that inequality drives change. To take just a few examples: the “no one is safe until we are all safe” message reinforces that vaccinating against Covid-19 is a global challenge; combating climate change can only be done globally with low-income countries, least equipped to adapt, inevitably hit worst; and inequality and conflict drive migration from poorer to richer nations. Intolerance of inequality is, however, growing. Pressures to address both domestic and global inequality are likely to increase, and this will influence businesses (see sustainability and Covid-19).
The role of the state is a key driver of domestic inequality because political decisions over social security support and taxes are instrumental in addressing it. Within the workplace, legislation and pressure from internal and external stakeholders can begin to address inequality. In light of the success of gender pay gap reporting, there are signs that pay equality reporting more generally will rise up the political agenda. If we see a shift to the left in politics, we can expect both executive pay and minimum wage levels (see role of the state – state intervention) to come under greater scrutiny. Businesses should also prepare for an increased focus on the terms and conditions, including pay, of those employed in their supply chains (see sustainability – social concerns; and corporate governance).
The pandemic has increased inequalities (see Covid -19 – growth and prosperity). Emerging from it, terms such as the “New Normal” and “building back better” are bandied around, but it remains to be seen whether the opportunity to prepare for a better, fairer future for all is meaningfully grasped.
While inequalities between men and women and between those from different racial or ethnic groups persist but are diminishing (see demographics – sex/gender and ethnic diversity), other inequalities are growing. A generational divide is opening up between baby boomers on one side and millennials and Generation Z on the other. Baby boomers benefited from generous grants to study at university or college, their wealth grew on the back of buying property when young and seeing house prices rise, and some enjoy defined benefit pensions. In contrast, millennials and Generation Z have none of those advantages (see demographics – ageing population and generations).
Other drivers of change are creating divisions in society which impact the workplace. Brexit has led to social divisions between “Leavers” and “Remainers”. Covid-19 is resulting in a split between those that have been vaccinated and those who have elected not to be, while highlighting more generally the different values of libertarians and those who favour a more rule-based society (see social trends – values and behaviours).
Covid-19 has also created a two-tier workforce, with those who can work from home benefiting from new flexibilities not available to these for whom homeworking is impractical because of their jobs or domestic circumstances (see Covid-19 – agile working; themes for the future - flexibility).