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Trends in earnings and income inequalities in Scotland and the UK 1997-2016

Date: December 2018
Category: Report
Author: David Walsh and Bruce Whyte

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This report presents findings from an in-depth analyses of earnings and income data for the four UK countries (including the largest cities in Scotland and England) over the past 20 years. 

We know that income inequalities in Scotland have widened considerably since the late 1970s. The more recent trends presented in this report show that there has been no real narrowing of the gap in the last 20 years. This is true of both household income inequalities, and also earnings inequalities. 

However, there has been some progress in the public employment sector, with proportionally bigger increases in earnings among the lowest paid resulting in relative inequalities in earnings in that sector decreasing over time. 

The report highlights that the lowest paid jobs in society are predominantly held by women – for example, around two thirds of all jobs paid below the real living wage. However, the overall gender gap in earnings has reduced considerably in the last 20 years – particularly in the public sector (where reductions have been greater in Scotland than in England). 

With income inequalities predicted to widen further in the years ahead, and given the well evidenced and profound links between income inequalities and health inequalities, the report highlights that health inequalities are also likely to widen unless there is a concerted political effort to address the issue. 

Although there is no simple solution, the report suggests some potential actions that could reduce income inequalities and have related health benefits such as freezing or reducing senior pay and increasing low pay within the public sector, and more progressive taxation.

Download the executive summary (PDF).