The economic gap between the world’s super-rich and everyone else is growing yet again, according to Credit Suisse’s 2017 global wealth report.
The report, published Tuesday, Nov. 11, revealed that the world’s richest people have seen their share of the globe’s total wealth jump from nearly 43 percent at the peak of the 2008 economic crisis, to 50 percent in 2017. But that’s not all. The increase in wealth among the already filthy rich led to the creation of 2.3 million new millionaires in just the past year.
“The share of the top 1% has been on an upward path ever since [the crisis], passing the 2000 level in 2013 and achieving new peaks every year thereafter,” the yearly report read. “Global wealth inequality has certainly been high and rising in the post-crisis period.”
Millionaires now account for 0.7 percent of the world’s adult population, yet control more than 45 percent of total global wealth, which currently stands at $280 trillion, according to the report. Meanwhile, the world’s poorest individuals are barely getting by with less than $10,000. Altogether, these 3.5 billion working class people hold just 2.7 percent of global wealth.
So where are most of the world’s millionaires living? Over two-fifths of them live in the U.S., followed by Japan (7 percent) and the UK (6 percent). In contrast, the world’s poor are mostly found in developing nations like India and Africa for example, where a large majority of adults — over 90 percent to be exact — are living on less than $10,000.
“In some low-income countries in Africa, the percentage of the population in this wealth group is close to 100%,” the report states. “For many residents of low-income countries, life membership of the base tier is the norm rather than the exception.”
Not only has the global number of millionaires risen significantly, but the amount of ultra-high net worth individuals, or UHNWIs, has increased five times over, making them the fastest-growing group of wealth-holders. These individuals have a net worth of $50m or more and are mostly created in the U.S.
Not everyone expects to acquire such wealth, however, especially millennials.
“Those with low wealth tend to be disproportionately found among the younger age groups, who have had little chance to accumulate assets,” Credit Suisse chairman Urs Rohner, explained. “But we find that millennials face particularly challenging circumstances.”
With limiting factors such as high unemployment, increased income inequality and reduced pensions, millennials are having a tougher time than their parents at their age when it comes to income, homeownership and other indicators of wealth, Rohner said. Millennials may also be more educated than their parents, but the chairman noted that “We expect only a minority of high achievers and those in high demand sectors such as technology or finance to effectively overcome the ‘millennial disadvantage’.”
Read Suisse’s full report here.