Income inequality in London compared with other English regions

Key points

  • Inner London is by far the most unequal of all regions in England.
  • Outside London, no region has significantly more than 10% of its population in the bottom tenth of national income distribution.
  • Income is more concentrated in Inner London than Outer London, and more concentrated in London than elsewhere. 20% of the population have about 60% of total income in Inner London, 50% in Outer London and 40% in the rest of England.

The proportion of the population with incomes in the top and bottom tenths of UK incomes

Shares of total net income

What do these graphs show?

In order to be consistent with the low-income statistics used elsewhere on this site, the measure of income used here is net income after housing costs (AHC). To be in the top tenth of income in 2007/08, a couple would require £708 per week, and a single person £410. By way of comparison, a couple without children with a net weekly income of less than £135, or a single person with an income of less than £78 would be in the bottom tenth.

Looking at shares of total net income, from the top graph we can see how income is more concentrated in Inner London than Outer London, and more concentrated in London than elsewhere.

20% of the population have about 60% of total income in Inner London, 50% in Outer London and 40% in the rest of England.

The poorest 50% have 15% of total income in Inner London, 20% in Outer London and 25% in the rest of England.

According to the second graph, 16% of people in Inner London live in the poorest tenth of households in the country. A further 19% live in the richest tenth. This means Inner London is by far the most unequal region in England.

Outer London also has an above-average proportion of both rich and poor people. 16% of the population in Outer London are in the top tenth of the national income distribution, and 14% are in the bottom tenth.

No English region other than London has significantly more than 10% of its population in the bottom tenth of the income distribution

Even if we take broader definition of "rich" and "poor", the pattern still holds. Inner London has the highest proportion of people in the bottom fifth by income, and the second highest proportion in the top fifth, just behind Outer London.

Data used

Household Below Average Income, DWP – the data is the average for the years 2005–06 to 2007–08

Indicator last updated: 13 July 2010

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