The richest have been hit hardest, but yes, it hurts them lessby Paul Johnson / January 23, 2013 / Leave a comment
Published in February 2013 issue of Prospect Magazine
George Osborne’s insistence throughout the recession that “we’re all in this together” has been criticised. Yet new figures show that the income of the wealthy has fallen (photo: HM Treasury)
At the start of the 1980s we experienced a deep recession. Unemployment soared to more than 3m—12 per cent of the workforce. During the following decade benefit levels were cut, earnings rose very fast especially for higher earners, and tax rates were cut for those on top incomes. Inequality grew at an unprecedented rate. By the end of that decade, on almost any measure, the UK was a much more unequal society than at the start. To have claimed that we were “all in it together” would have been fatuous.
Since 2008 we have experienced a much deeper and more prolonged recession than we did in the 1980s. Output fell by more and has still not recovered its pre-recession levels. Household incomes have fallen by more than at any time in many decades.