U.K.'s Low-Paid Men See Hours Fall as Wage Inequality Widens

  • IFS says 20% of low-paid men work part time versus 5% in 1994
  • Incomes of top 1% pull away from the rest of the population

Falling working hours among low-paid men are contributing to inequality in the U.K., according to the Institute for Fiscal Studies.

About 20 percent worked part-time in 2014 whereas just 5 percent did so in 1994, the London-based IFS said in a report published Friday. Higher up the income scale, the proportion of men working fewer than 30 hours a week remains at less than 5 percent.

The report also revealed that the incomes of the highest earners have pulled away from the rest of the working population, with the top 1 percent accounting for 8 percent of net household income compared with 6 percent two decades earlier.

Inequality is at the center of political debate in the U.K. after the vote to leave the European Union exposed a divided country where many people feel left behind. In a separate report this week, the IFS said that disparities are being exacerbated by inherited wealth from a decades-long house-price boom.

The IFS said growing wage inequality among men is a long-term trend rather than something triggered by the global financial crisis. It contrasts with the situation for women, who have  seen the gap between the highest-paid and the lowest-paid narrow.

The tax and benefits system has helped to offset the disparities in pay as tax credits boost the incomes of low earners and pensioners catch up with the rest of the population, according to the report. As a result, while wage inequality was worsened, overall income inequality for the majority has narrowed.

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