The wealth gaps between different ethnic groups in Britain are likely to persist, according to new Resolution Foundation research.
The report explored how the wealth gaps between different ethnic groups have changed over the past decade. It also showed what these shifts mean for individual household abilities to weather the Covid-19 crisis, and for wealth inequality in post-pandemic Britain.
The report found that in the UK, people of black African ethnicity typically hold the lowest wealth (a median figure of £24,000 family wealth per adult), which amounts to less than one eighth of the typical wealth held by a person of white British ethnicity (£197,000 family wealth per adult).
Additionally, those of Bangladeshi ethnicity typically hold £31,000 family wealth per adult, while those with mixed white and black Caribbean ethnicity typically hold £41,800.
The foundation revealed that the gap between the ethnic groups with highest and lowest median household wealth (white British and black African households respectively) has grown to £173,000.
The analysis showed that prior to the pandemic, at least half black African, Bangladeshi and black Caribbean ethnicity households in the UK had less than £1,000 in family savings to act as a “buffer” in case of a fall in their income.
George Bangham, economist at the Resolution Foundation, said: “There are stark gaps in the amount of wealth held by different ethnic groups in Britain. These wealth gaps are having a serious impact on the resilience of different households in the face of income shocks during the Covid-19 crisis, and on the life choices of current and future generations.
“Despite significant progress in closing education and employment gaps between different ethnic groups, these wealth gaps are likely to persist. Even high earners will struggle to save their way to being high wealth, while White British people are much more likely to inherit significant sums than those of other ethnic groups.”
He added: “Policy makers need to recognise that wealth gaps may be much harder to close than other differences between ethnic groups, particularly as they are often hardly discussed.
“There is no silver bullet to tackling persistent wealth inequalities but wealth tax reform and better targeting of support for people to access home ownership or save for a pension would help.”