The UK is one of the most unequal developed nations in the world, according to a new report warning that such disparity stunts economic growth and damages the fabric of society.
The OECD’s study 'In It Together: Why Less Inequality Benefits All' has revealed that income inequality rises both in times of prosperity, as well as when the economy is performing badly.
It added that growth has disproportionately benefited high income groups, and left lower income households behind.
The top 10 most unequal developed countries in the world
In turn, inequality has negatively affected GDP growth as the distance between the lower 40 per cent from the remainder of society becomes wider.
Across 34 member states, income inequality between 1985 and 2005 knocked 4.7 percentage points off cumulative growth between 1990 and 2010 on average, according to the study.
“Lower income people have been prevented from realising their human capital potential, which is bad for the economy as a whole,” an abstract to the study states.
To make their findings, researchers ranked inequality in the developed world according to the distribution of income.
The OECD says its findings raise social and political questions in addition to economic ones.
Researchers have urged world leaders to tackle resulting problems by developing policies targeting non-standard work and job polarisation; persistent gender gaps; and high wealth concentration.
Get the latest OECD data HERE.
Additional reporting by APReuse content