Capital owners gain, workers lose: the widening wealth gap

One of the main reasons a large share of the global population continues to live in highly unequal countries is the rising share of national income accruing to capital (through profits, rents, and dividends) compared to labour (through wages and salaries). Between 1990 and 2024, the capital share of national income increased in 56% of countries, covering 74% of the world’s population. The chart below shows the capital and labour share of the national income, globally.

Capital ownership itself is highly unequal. An estimated 85% of the world’s population derives no income from capital. The chart below shows the share of the population living in households with less than $100 in annual capital income per person. In India, 97% of the population falls within this category. Even labour income is highly unequal. Between 2019 and 2024, average global CEO pay increased by 50%, while average worker’s pay rose by less than 1%.

Because of this unequal accumulation of wealth, private wealth has far outpaced public wealth. As a result, several governments face significant net debts. The chart below shows the amount of private and public wealth in trillion $ between 1980 and 2024 as per current prices.

Such economic inequality also leads to social inequality within and across nations. For instance, in the U.S., African American women are more than twice as likely to die in pregnancy or childbirth than white women, or women in Kerala in India. The chart below shows maternal mortality across racial, regional, and economic groups.