Prosperity, poverty and inequality in London 2000/01-2010/11

Document type
Lupton, Ruth; Vizard, Polly; Fitzgerald, Amanda
Centre for the Analysis of Social Exclusion
Date of publication
1 July 2013
Social Policy in a Cold Climate: Research Report 3
Poverty Alleviation Welfare Benefits and Financial Inclusion, Education and Skills
Social welfare
Material type

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This report looks at changes in poverty and inequality in London during the 2000s, with a focus on the impact of recession from 2008. It also considers how a decade has changed the geography of poverty in the Capital. Key findings are:

  • The economy and labour market in London proved more resilient to the onset of recession than in other English regions. However, Inner London fared better than Outer London.
  • Full-time employment fell by less across London than elsewhere in the country and there was a smaller rise in unemployment.
  • Employment levels among some population sub-groups, including young people and Black/Black British people, were lower in London than other regions before the recession, but had converged by 2010.
  • Qualification levels among working-age adults were higher in London before the economic crisis than elsewhere and continued to improve more rapidly during the recession.
  • While London coped well with some economic pressures, inequalities in earnings and incomes increased between 2006/8 and 2010. Those living on the lowest incomes were hit hardest, seeing their incomes after housing costs fall by 24 per cent in real terms compared with 3.5 per cent nationally.
  • Wealth inequalities also widened faster in London than in other regions.The wealthiest Londoners increased their financial, physical and property wealth by 8 per cent between 2006/8 and 2010. This compared with 0.4per cent among their counterparts elsewhere.
  • Poverty became less concentrated in Inner London and began to spread outwards. This was partly due to population change and ‘gentrification’ in Inner London, but also because the recession appeared to hit Outer London harder.

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