The lives of the other four fifths1
“ . . . this is not simply about extremes of wealth and poverty. There is a continuous
gradient in death rates all the way through society—even among the middle classes.
The higher people’s status, the longer they live.”
Richard Wilkinson, 20052
“People with higher socioeconomic position in society have a greater array of life
chances and more opportunities to lead a flourishing life. They also have better
health. The two are linked: the more favoured people are, socially and economically,
the better their health.”
Michael Marmot, 20103
Key Findings
• Social gradients: incremental increases in income correspond to incremental improvements in outcomes.
• Distribution: households in the richest quintile earn almost 15 times
more than those in the poorest quintile. Tax and benefits reduce this
difference to just over 4 times more.
• Perceptions: people tend to misperceive which income group they
are in.
• Health: richer groups have a lower risk of mental illness. Poorer
groups have higher prevalence of obesity and eat less fruit and fewer
vegetables.
• Possessions: as groups get richer they have more and bigger cars.
Better off groups also have more household insurance than their poorer
counterparts.
• Education: as parents become more professional, their children have
more academic qualifications.
• Gender: when individuals’ rather than household incomes are compared, women are disproportionately found in poorer income groups
whereas there are more men in richer groups.
• Social mobility: over a 10-year period very few people moved between the top and bottom income quintiles.
1
Introduction: the importance of knowing how the
rest of society lives
The harmful impact of inequality at the national scale has been well documented in The Spirit Level by Richard Wilkinson and Kate Pickett4 . This
short report looks at a smaller scale, and shows the distribution of some
of these harmful impacts of inequality within the UK population. In each
case, as Wilkinson and Pickett argue, richer groups and poorer groups are
affected. However, as you will see in the following pages, poorer groups
in society suffer disproportionately from poor physical and mental health,
worse material conditions, and lower educational qualifications. I also show
that there is a pattern to these distributions, with women generally earning
less than men, and people of Pakistani and Bangladeshi origin being mainly
in the lower earning segments of society.
The motivation behind this report is to share a few facts that we should
know about the country we live in; things that are not always obvious. To
describe the differences between the lives of people in diverse economic situations, this report mainly focuses on quintiles, or fifths, of the population.
The bottom quintile is made up of the 20% of the population who have the
lowest incomes, the second quintile is the 20% with the second lowest, and
so on, up to the top quintile, made up of the 20% of the population with the
highest incomes. In this report, we mainly use household incomes, accounting for household size, rather than individual incomes. This is because, if a
person is unemployed but their partner has a job, the partner’s income still
affects the standard of living for the whole household.
Figure 1: Thinking of society in quintiles, divided into 5 equally sized groups
Thinking in terms of fifths (quintiles) enables comparison between groups.
A finer grain, such as tenths (deciles) would pick up more detail but be difficult to imagine. (Holding five numbers in your head is much easier than
ten.) Comparing income quintiles shows that as groups get poorer they have
incrementally worse outcomes. This pattern is termed a social gradient.
Before describing the differences in people’s lives between income quintiles, it is worth considering income differences themselves. Figure 2 shows
household income before (light orange) and after (dark orange) tax and benefits. Income differences between quintiles are larger before tax and benefits.
There are websites where you can work out which quintile you are in.5
It may surprise you to find out which group you are in, as surveys show
that three quarters of British people misperceive their economic position
within British society7 . People tend to think that they are poorer than
2
Figure 2: Household incomes by quintile for 2008/096
they really are. Figure 3 may look complicated, but it shows an interesting
pattern. Each line represents an income quintile: the poorest 20% are dark
blue, the less well off 20% are red, the middle 20% are green, the affluent
20% are purple and the richest 20% are brown. The high point of each line
is where most people in that group believe their income sits compared to
others’.
Most people who are actually in the poorest 20% (dark blue line) perceive
their incomes are “towards the bottom”, which is accurate, but 5% of the
poorest believe their incomes are above the middle. The middle-income
group (green) underestimate their economic position, thinking their incomes
are below the average. Many affluent and rich people also judge themselves
to be middle earners, and very few consider themselves to be “towards the
top”.
Other research has found that people often perceive themselves as being
in the middle of society, even when they are very rich9 . When recently
asked, even city high-flyers amongst the top 0.1% of earners, denied being
rich10 . The standard explanation for findings like this is that most of us
tend to know people who are a bit richer and a bit poorer than us. Most
of us don’t get to really know that many people who are in very different
income groups to our own. The graph below shows that from our different
vantage points within society, almost all of us (85%) consider that we have
3
Figure 3: Perceived and actual income groups8
low to average earnings.
What follows is a series of graphs showing the social gradient in lifestyles
in the UK, and how this is aligned with income11 .
Five British households: zooming in to see how people’s lives vary
An example of a household in the poorest quintile is located in the East
Midlands and consists of 5 adults sharing their home. There are no children
living with them. As a group their total earnings are £1,875 per month.
When adjusted for household size, to compare them to other households,
their household income reduces to just £625 a month 12 . Their home is
rented from a private landlord, and they are not able to keep their home
warm enough all year round. There are five bedrooms, one each, and two
other rooms in the house. They have cable TV, but no landline telephone.
The household has two small cars between the five adults living there.
Moving up to the second lowest income quintile, an example is a household in the East of England, where an elderly lady lives alone. She lives on
£1,044 each month (this income does not need adjustment for household
size because she lives alone). She rents a two–bedroom home from the local
authority, at a cost of £66 per week. She has no car, nor a home computer.
This is the only one of these five households with no connection to the inter4
net from home. Like the other four households, she has a washing machine,
freezer, a colour television, and a DVD or video player.
An example of a household that is right in the middle of the income
distribution, is represented by a couple living in Wales and earning £2,183
which reduces to £1,455 when adjusted for there being two people sharing
this income. This couple rent their home from a housing association and
share one medium sized car with a medium engine size. They pay £280 rent
each month for their two–bedroom home (NB: the poorest household pay
about the same each week, for their privately rented accommodation).
An example of an average household in the second richest group has
roughly £500 more a month, and they earn £1,950 after adjustment for
household size, or £2,925 unadjusted. This couple, one of whom is old
enough to claim their pension, live together in the East Midlands. They
own their three–bedroom house outright, a property which they bought in
1966 for just £12,000. They share one car, but in contrast to earlier groups,
their car has a large engine.
The earnings difference between the affluent and rich group is the biggest
jump in earnings between quintiles, with an increase of over £1000 a month.
The example of a household in the richest quintile is an adult of working age
in the South East of England, and earning £3,004 a month. This household
is the only one with a tumble drier, and also the only household that never
recycles rubbish. The householder, who lives alone, has three cars. All
the cars have large engines. This property was bought with a repayment
mortgage in 2007 for a cost of £183,000. The mortgage payments for this
two–bedroom place are £936 per month for the next 24 years.
This brief introduction to these five households gives some insight into
the variations between income groups in the UK. Of course there is much
more of a story to each household, including pastimes, family life, hopes and
frustrations, jobs, and health.
This zoomed-in look at these five households offers some context for
the overview offered in the remainder of this report, where real people and
their living conditions are summarised to give a general description of life in
contemporary Britain. Because the data used in the next section come from
different sources, some comparisons are made between income quintiles, and
some are made by occupation classes rather than income quintile, but these
are closely related, and show the same social gradients.
Health: obesity and risk of mental illness increase
as incomes decrease
Mental and physical health vary with income group, with worse health generally being more common lower down the social scale. When it comes to
preventative behaviour, more people in managerial and professional occu5
Figure 4: Who eats their five a day? Britain in 200113
pations (higher social class) eat five portions of fruit and vegetables a day
than in semi-routine and routine occupations (lower social class) (see figure
4). Women are better at eating their recommended fruit and vegetables
than men, however in all occupational groups the majority do not eat the
recommended ‘five a day’.
Possible causes of the pattern shown above include the high cost and
unavailability of fresh fruit and vegetables in poorer neighbourhoods, and
the non-existence of a culture of appreciating this food. Having a poor
diet is one contributor to obesity. There is more variation in obesity levels
(figure 5) between income quintiles amongst women than men: in the rich
quintile 19% of women are obese and this figure increases to 29% for the
poor quintile (the equivalent for men is 24% and 25% respectively, a tiny
difference of just 1%). In this case the less well off quintile has higher obesity
rates than the poorest. Nevertheless, the overall pattern shows worse health
in lower income groups. Obesity is a health concern partly because it is
associated with a greater risk of a range of other health problems.
These health inequalities are not restricted to physical health, but extend
to mental health. There is a clear social gradient in risk of mental illness
(figure 6). In the poorest quintile, more than twice as many men and women
are considered to be at high risk of mental illness than in the richest quintile.
A quarter of women in the poorest quintile are at high risk of mental illness.
6
Figure 5: Adult obesity in England, 2004–0814
Figure 6: High risk of mental illness, 2008–200915
7
Risk of mental illness can stem from many circumstances, including stress,
lack of financial security, and lack of respect. These circumstances appear
to cluster towards the bottom of the income scale. As with obesity, women
are more prone to risk of mental illness than men.
Material conditions: richer people have more holidays, more cars and more insurance
Figure 7: Car ownership16
Susceptibility to mental illness may be linked to anxiety about one’s
ability to “keep up” socially, but also whether one’s environment is conducive
to feeling safe and relaxed. Holidays incorporate both of these aspects.
Having a holiday is usually an enjoyable experience. Living in a society
where going on holiday is the norm and a frequent topic of conversation
means that not going away can be particularly disappointing. In the UK in
2008/9 only 61% of children had at least a one week holiday (going away
from home). The majority of these children are in the middle, affluent and
the richest groups, of whom 68%, 80% and 92% respectively get away on
holiday. The poorest quintiles had disproportionately fewer holidays: of the
less well off quintile 51% had no family holiday in 2008/9, and in the poorest
quintile 66% did not go on holiday17 .
8
Figure 8: Home contents insurance, 200818
In towns and cities where infrastructure is based mainly on the car,
living without a car can be tricky when it comes to travelling late at night,
or shopping at a supermarket that is far from one’s home. That said, many
people live well without a car, by walking, cycling, public transport and the
generosity of friends. There is a social gradient in car ownership—poorer
quintiles have fewer cars and ownership of two or more cars is more common
among richer households. As with holidays, when car ownership is the norm,
not having a car can leave a family feeling as though they cannot keep up
socially.
As well as the capacity to afford holidays and material goods, a gradient
can be seen in home contents insurance. The richer a household is, the
more likely they are to have insured their possessions. There is a sharp
decrease in insurance from the less well off to poorest quintile, where a
quarter, then half, have uninsured home contents. Insurance is intangible,
it is risk management. As such, lack of insurance may not seem like an
important inequality. However, it is indicative of the vulnerability of a whole
segment of society, who, if they do lose their possessions through theft or fire,
will be unable to replace them easily. The richer groups generally have an
extra financial cushion of personal wealth that provides additional financial
security.
9
Figure 9: Whose children attain level 2 qualifications?19
Education: parents’ profession relates to children’s
qualifications
Educational qualifications are more abundant amongst the children of professionals than amongst the children of other occupation groups. (Note that
here occupation is used rather than household income quintile). Figure 9
above shows the percentage of children who attain a Level 2 qualification
by the age of 17 years old. Level 2 is equivalent to 5 A*—C GCSEs, General National Vocational Qualifications, to Level 2 in National Vocational
Qualifications and Vocationally Related Qualifications, as well as some apprenticeships. Whilst almost 9 out of 10 of the higher professionals’ children
gain this level of qualification, and many go on to further study at higher
levels, only half of the children with parents in routine jobs attain these
qualifications.
Financial contributions: the poor pay less income
tax but more consumption tax than the rich
The proportion of income spent on tax varies with income group and the
type of tax being paid. Income taxes take a higher proportion of the gross
10
income of richer quintiles, on average the richest quintile pays a quarter of
their known gross income. This percentage declines rapidly so the poorest
group contributes just over a tenth of their income (figure 10a), because
taxes are based on income. In contrast, consumption-related taxes have
the opposite pattern. The poorest quintile spends a quarter of their gross
income on consumption-related taxes, while the richest quintile spends just
under a tenth of theirs (figure 10b). This is because even when paying the
same amount of VAT on identically priced goods, this fixed value is a higher
proportion of a poorer person’s income. By reading figures 10a and 10b
together, we observe that overall each quintile pays roughly the same total
proportion of their gross income as tax, roughly 35%.
(a) Income tax
(b) Consumption tax
Figure 10: Taxes on the non–retired, 2008–2009.20
Who is in each quintile? There are fewer women
and more men in the higher earning quintiles of
individuals’ income
The data collected in this report illustrate a social gradient in living conditions and life chances between income groups in the UK. Sometimes these
social gradients are steeper than others, yet there is a general pattern that
those who earn less money or have lower social class have worse outcomes.
This is not a random phenomenon, and neither is the distribution of people
between these groups. Certain characteristics make you more or less likely
to belong to each group, as demonstrated in ‘An Anatomy of Economic Inequality in the UK’, led by John Hills and commissioned by the previous
UK government21 . As one might expect, people in higher managerial and
professional jobs are mainly (62%) in the richest quintile when measured
by weekly earnings. Only 2% are found in the lowest earning fifth. In contrast, those in routine and semi-routine occupations are predominantly in
11
the bottom half of the income distribution22 .
Figure 11: Earnings by gender, 2006–2008.23
In terms of ethnicity, white British people are evenly distributed between
all earnings quintiles, the same is not true for other ethnic groups. People of
Indian origin are found more often in the higher earning quintiles, whereas
the reverse is true for people of Pakistani and Bangladeshi origin, 56% and
64% respectively are in the poor and less well off groups. It is widely argued
that it is racism and sexism, not race and gender themselves, that result in
women and some ethnic minorities being disproportionately represented in
lower income quintiles (see figure 11).
Social mobility: moving from the bottom to top
quintile is rare
Contemporary political debate often focuses on social mobility, to the extent
that social mobility, or equal opportunity rather than greater equality of
outcomes, is often the stated aim of policy25 . This arises from the idea
that people should be financially rewarded in accordance with their skills
and efforts. Meritocracy is not an automatic route to equality, because it
justifies paying people differently based on how their work is valued and so
leads to inequalities in income and wealth. Having different resources means
12
Figure 12: Social mobility: income group in 1991 compared to 2001. Data
refer to Great Britain and are in percentages24
that some are better placed than others to develop the skills and attain the
qualifications that will lead them and even their children to be better paid26 .
The table above shows movements of people between income quintiles
during the decade 1991–2001. People in the richest and poorest quintiles
were most likely to stay put, with over 40% of each group being in the same
position in 1991 and 2001. This is partly because those in the poor fifth
who get still poorer remain in that group, and likewise, those in the rich
group who get considerably richer are still in the same group. Nevertheless,
for all quintiles, the most common outcome was no social mobility. Extreme
upward or downward mobility was rare: the poor seldom became rich, and
neither did the rich often become poor. What was more common were
shifts between adjacent quintiles, people getting a little richer or poorer.
As such we observe that in the recent past social mobility did not lead
to a dramatic economic repositioning, but there was some flexibility and
movement between groups.
One point for reflection is that social mobility is usually discussed as
a positive thing, with the focus on upward mobility. The often unspoken
aspect of social mobility is downward mobility, with a similar proportion
of people moving down from the less well off quintile to the poor quintile
(24%), as moved up from being poor to be ‘less well off’ (26%).
Conclusion: not just rich and poor
This report has detailed a recurring pattern or social gradient: people in
richer income quintiles have more desirable outcomes than those in poorer
quintiles. The key point is that as people get a bit poorer, then many
negative outcomes tend to increase. Whilst the differences between the
richest and poorest are the most extreme, it is worth remembering that
those who are just outside the poorest group are not faring a lot better
than the very poorest, and those just below the very rich do not do as
well, even though they are affluent. Current political discourse argues that
13
we should focus policy efforts on the very poorest members of society, yet
politicians should be cautious of not accidentally overlooking the difficulties
experienced by those who are only doing slightly better than the poorest
and most vulnerable in society.
Another important observation is that the social gradient of negative
outcomes accumulating as you go down the income scale exists for a diverse
range of variables. This short report has shown how, for mental health,
physical health, possessions, security, and education, increments in income
correspond with incrementally better outcomes. The causes of this are only
partly to do with capacity to pay for certain goods and services, but more
importantly related to the stigma and stress associated with not being able
to afford those things considered to be normal within UK society, and the
stress of low social status itself. One self-evident solution to this unjust
pattern would be a more equitable distribution of wealth amongst the population. This would be likely not only to prevent poorer groups suffering
disproportionately, but would likely reduce the overall prevalence of these
problems in all income quintiles27 .
14
Notes
1 Suggested
Citation: Barford, Anna. “The lives of the other four
fifths.” Equality Trust Research Digest 2011; no.3: pp.1–17
Anna Barford, The Equality Trust. This work was funded by The Roberts
Fund, of the University of Sheffield. Email: [email protected]
cc
—Attribution.
Some Rights Reserved.
2 Wilkinson,
R. 2005. The impact of inequality: how to make sick societies
healthier. New York: The New Press. p.15.
3 Marmott,
Michael. 2010. Note from the Chair. in Fair society, healthy
lives: the Marmott Review. Executive summary. p.3. Available at: http:
//www.ucl.ac.uk/gheg/marmotreview/ Accessed 10.05.2011
4 Wilkinson,
R. & Pickett, K. (2009) The spirit level: why more equal
societies almost always do better. Allen Lane.
5 The
Institute for Fiscal Studies offers a calculator to position your
household income in relation to that of the rest of the population, called
“Where do you fit in?”. It can be found here: http://www.ifs.org.uk/
wheredoyoufitin/ Accessed 11.05.2011
6 Office
for National Statistics. The effects of taxes and benefits on
household income, 2008/09. Source: www.statistics.gov.uk/STATBASE
Accessed 03.03.2011
7 Based
on data from Lansley, S. (2009) We all think we’re in the middle.
P.29 in Hampson, T. & Olchawski, J. (Eds.) Is equality fair? What the
public really think about equality - and what we should do about it. London:
Fabian Society. p.29
8 Based
on data from Lansley, S. (2009) We all think we’re in the middle.
p.29 in Hampson, T. & Olchawski, J. (Eds.) Is equality fair? What the
public really think about equality - and what we should do about it. London:
Fabian Society. p.29
9 Bamfield,
L. & Horton, T. (2009) Understanding attitudes to tackling
economic inequality. Joseph Rowntree Foundation. p.12
10 Toynbee,
P. & Walker, D. (2008/2009) Unjust rewards: ending the greed
that is bankrupting Britain. London: Granta Publications. p.23-4
11 It
is worth noting that income inequality is generally less extreme than
wealth inequality; however here I focus on income partly because this is
15
more frequently reported.
12 Adjusting
income for household size means taking account of the number
of adults and children living there, in order to make household incomes
comparable despite variation in household size. The adjustment calculation
divides the actual household income by the number of occupants, taking into
account that children generally consume less than adults, and accounting
for the economies of scale of living together, e.g. cheaper bills. Thus the
incomes in bold type are not real, but “equivalised” so that total incomes
can be compared between households.
13 Joint
Health Surveys Unit (2003) Health Survey for England 2001: Fruit
and vegetable consumption. The Stationery Office: London. Source: http:
//www.heartstats.org/datapage.asp?id=928 Accessed 03.03.2011
14 Source:
National Obesity Observatory data briefing. Adult Obesity and
Socioeconomic Status. October 2010. www.noo.org.uk Accessed 03.03.2011
15 Health
Survey for England. Data are an average for the period 2006–
2008. These data refer to people aged 16 up to retirement age. Notes “The
allocation of households to income quintiles uses gross ‘equivalised household income’, which means that the household incomes have been adjusted
to put them on a like-for-like basis given the size and composition of the
households.” And “A high risk of mental illness is determined by asking
informants a number of questions about general levels of happiness, depression, anxiety and sleep disturbance over the previous four weeks, which are
designed to detect possible psychiatric morbidity. A score is constructed
from the responses, and the figures published show those with a score of
4 or more. This is referred to as a ‘high GHQ12 score’.” Available from
http://www.poverty.org.uk/62/index.shtml Accessed 13.05.2011
16 These
data are from the Understanding Society dataset, wave 1, year 1,
collected in 2009. Available at http://www.understandingsociety.org.
uk/ Accessed 11.05.2011.
17 Adams,
N., Barton, A., Bray, S., Johnson, G. & Matejic, P. (2010)
Households below average income: An analysis of the income distribution
1994/95–2008/09. Department of Work and Pensions.
18 Living
costs and food survey 2008. Office for National Statistics. Source:
http://www.poverty.org.uk/74/index.shtml
19 Social
Trends 40. 2010 edition. Chapter 3, Education and training.
p.38, table 3.16. Source: http://www.statistics.gov.uk/cci/nugget.
asp?id=2449 Accessed 02.03.2011. Note: “Five GCSEs at grades A* to C
are the equivalent of a level 2 qualification in the UK which also include
16
National Vocational Qualifications (NVQ) and Vocationally Related Qualifications (VRQ), both at level 2, General National Vocational Qualifications
(GNVQ) and some apprenticeships.” P.37–8 This is based on parental social
class.
20 These
data are from the Understanding Society dataset, wave 1, year 1,
collected in 2009. Available at http://www.understandingsociety.org.
uk/ Accessed 11.05.2011.
21 Living
costs and food survey 2008. Office for National Statistics. Source:
http://www.poverty.org.uk/74/index.shtml
22 Hills,
John and Brewer, Mike and Jenkins, Stephen P and Lister, Ruth
and Lupton, Ruth and Machin, Stephen and Mills, Colin and Modood,
Tariq and Rees, Teresa and Riddell, Sheila (2010) An anatomy of economic
inequality in the UK: report of the National Equality Panel. Centre for Analysis of Social Exclusion, London School of Economics and Political Science,
London, UK p.45. Source: http://eprints.lse.ac.uk/28344/ Accessed
10.05.2011. Data refer to 2006–8 and are sourced from the Labour Force
Survey, which itself sourced these data from the NEP.
23 These
data are from the Understanding Society dataset, wave 1, year 1,
collected in 2009. Available at http://www.understandingsociety.org.
uk/ Accessed 11.05.2011.
24 Church,
Jenny. 2004. Chapter 4: Income. In Focus On Social Inequalities: 2004. Editors Penny Babb, Jean Martin and Paul Haezewindt
Office for National Statistics London: TSO. p.48. Available at http://www.
statistics.gov.uk/focuson/socialinequalities/ Accessed 17.01.2011.
Their data source was: Department for Work and Pensions from the British
Household Panel Survey, Institute for Social and Economic Research.
25 For
example: HM Government. April 2011. Opening doors, breaking
down barriers: a strategy for social mobility. http://download.cabinetoffice.
gov.uk/social-mobility/opening-doors-breaking-barriers.pdf
26 For
further discussion on meritocracy, see: White, Stuart. (2007) Equality. Cambridge: Polity Press.
27 Wilkinson,
R. and K. Pickett. 2010. The Spirit Level: why equality is
better for everyone. London: Penguin.
17