London's Poverty Profile has been created by one of London's largest charitable funders, Trust for London, and the independent think tank, New Policy Institute.
Ratio of low and high pay by borough
- Camden has the lowest pay ratio between the 80th and 20th income percentiles (so is the least unequal), while Tower Hamlets has the highest.
- In 20 of 32 boroughs, pay inequality increased between 2009 and 2014.
80:20 pay ratio by London borough
What does the graph show?
This graph shows the ratio of low to high pay in each London borough in 2009 and 2014. The ratio is between pay at the 20th and 80th income percentiles.
Pay inequality varies by London borough, although this is not marked by straightforward trends between Inner and Outer London. Camden has the lowest pay ratio between the 80th and 20th income percentiles (so is the least unequal), while Tower Hamlets has the highest.
In 20 of 32 boroughs, pay inequality increased between 2009 and 2014. This looks inconsistent with the graph that shows inequalities have not grown [link to Figure 4.4]. This might be because we are looking at the 80:20 ratio rather than the 90:10 ratio because the former is more reliable when looking at the local level. But it could be to do with where jobs in London are based - for example Westminster contains a large proportion of London's jobs and didn't see a rise in the ratio.
Still, some of these ratios are very high and rising - in Tower Hamlets, the ratio of high to low pay is now over 3.2, compared with 2.9 in 2009. The recovery in financial services, which is where many of the high paid Tower Hamlets jobs are, has raised the pay of high earners much more than the average.
Annual Survey of Hours and Earnings, ONS
Indicator last updated: 15 October 2015
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