Pay inequalities in London

What does this graph show?

The graph above ranks boroughs by the differences between the pay of the top quarter and the bottom quarter of employed residents. Ideally, we would like to look at the difference between the top and bottom tenths (which we would expect to show a greater level of inequality) but the data is not always available, particularly for those boroughs where inequality is greatest.

The difference in London is greater than the average in England. In London, Kensington & Chelsea has the biggest gap between high and low earners, both in relative and absolute terms. Those in the top quarter earn on average £40 per hour and the bottom quarter earn on average £12 per hour.

Inequality is high in areas where both the top and bottom quartile pay is high (most obviously, Kensington & Chelsea). It is low where both top and bottom quartile pay is low (Newham, Barking & Dagenham). So even in unequal areas, the low paid are better paid.

But the variation in pay is much greater at the top end than the bottom. The top 25% in Kensington & Chelsea earn £40 per hour, some 2.5 times higher than the top fifth in Newham. The bottom fifth in Kensington and Chelsea are also better paid than the bottom fifth anywhere else, but the difference is not as great (1.6 times higher than Barking & Dagenham, where bottom quartile hourly pay is lowest).

Find out more about low pay in London.

Data used

ASHE 2008–2010, ONS

Indicator last updated: 30 January 2012