Press release: Can we shrink the widening wealth gap between the generations?

11 February 2025

Gresham College to welcome Dr Mike Brewer for lecture on Tuesday, 18 February, online and in central London where he will argue that stable income inequality, rising household wealth – fuelled by house prices – and weak income growth are creating intergenerational tensions 

Days after Rachel Reeves launched a Plan For Change, where she said she will go further and faster as part of a decade of national renewal and economic growth, a leading economist is to argue that without tackling inequality the measures won’t work.  

The Chancellor says without growth the next generation cannot be given the opportunities they need to thrive, nor can there be economic growth that would improve the lives of ordinary working people. She wants thriving businesses that create wealth for ‘our children and grandchildren’.  

But research by the Resolution Foundation shows that household incomes are at a similar level to where they were in the mid-2000s. This means the so-called ‘squeezed middle’ of the country are not feeling any richer or seeing any changes within their living standards.  

The situation is exacerbated by a change in working patterns, with many now on part-time or zero-hour contracts, negating the impact of minimum wage increases or changes to National insurance rates.  

Dr Mike Brewer, Deputy Chief Executive of the Resolution Foundation, will explore these issues and offer some solutions when he is the guest speaker at Gresham College on Tuesday 18 February at Barnard’s Inn Hall, central London.  

“The UK's income inequality has remained stable since the 1990s, but household wealth has nearly doubled, in part driven by soaring house prices. This has widened the wealth gap between generations with younger people less likely to own homes,” he said. 

“Furthermore, weak income growth since the mid-2000s has disproportionately affected younger cohorts. 

“This lecture unpacks these economic trends to reveal how they have created tensions between generations by exacerbating disparities in their respective living standards.” 

Rising house prices have played an important role in driving up the value of household wealth.  

Over the past five years, the average price of a detached property increased by nearly 27%, while a flat has increased by 15%. These figures highlight the increased problems younger generations are facing when buying a home. 

Dr Brewer says the huge growth in house prices since the mid-1990s has also upended patterns of homeownership, with today’s young people far less likely to own their own homes than their parents were. This means that today’s Generation Rent are still likely to become a generation of homeowners (where 50 per cent own their own home), but this will be more than half a decade after their parents’ generation reached this milestone. 

Younger residents have also been hit by weak income growth since the early years of the 21st century. While recent cohorts would have expected to have seen rapid earnings growth in their 20s and 30s, this has changed: the cohort born in the 1980s, for example, has experienced lower levels of earnings than the 1970s cohort at the same age for most of their working life. 

This has an impact on disposable income, which has slowed or stopped for the youngest: For example, over a 25-year period beginning from the age of 25 or 30, median within-cohort income for those born in the 1940s and 1950s approximately doubled, in real terms. 

Those born in the 1960s saw a rise of around a half from age 25 to 50; on current trends, those born in the 1970s will see a rise of less than a quarter over 25 years. 

Dr Brewer will argue that this income inequality creates an unequal nation, with around a quarter of the UK population having little or no wealth.  

Can anything be done to mind the gap, or are we destined to become a society where the disparity increases, which in turn leads to friction between the generations? 

“Those born in the 1980s or later are suffering from the UK’s poor record on productivity and having missed out on falling or low interest rates that have caused a surge in the value of wealth that has principally accrued to those in previous generations,” Dr Brewer says.  

“When people across the income range are not enjoying the same sort of incremental advances in pay and living standards that used to be the norm, they may be more inclined to suspect that anyone who is outdoing the stagnant average is doing so at their expense.  

“All of which goes to show, that if we really want to make Britain feel better, we need to get inequality down as well as getting growth up.” 

The lecture will be given at Gresham College’s base in Barnard’s Inn Hall, Holborn, London. 

Starting at 6pm on 18 February 2025, entry is free, and it is also broadcast live online. It will last an hour.  

In-person places can be booked online via Gresham College’s website, https://www.gresham.ac.uk/whats-on/uks-generational-wealth-gap 

ENDS 

Images available on request

For more information about this story or to arrange an interview with a Gresham Professor please contact: Phil Creighton press@gresham.ac.uk   

Notes to Editors

About Gresham College  
Gresham College has been providing free, educational lectures - at the university level - since 1597 when Sir Thomas Gresham founded the college to bring Renaissance Learning to Londoners. Our history includes some of the luminaries of the scientific revolution including Robert Hooke and Sir Christopher Wren and connects us to the founding of the Royal Society.  

Today we carry on Sir Thomas's vision. The College aims to stimulate intellectual curiosity and to champion academic rigour, professional expertise and freedom of expression. www.gresham.ac.uk  

Gresham College is a registered charity number 1039962 and relies on donations to help us encourage people's love of learning for many years to come. For more details or to make a gift, visit our website.