Aug 16, 2023 - Economy

New data: Global wealth rises, inequality falls

an illustration of a gold glowing location pin

Illustration: Tiffany Herring/Axios

The amount of wealth in the world is set to rise substantially even as inequality declines. That's the conclusion of Swiss bank UBS' 14th annual global wealth report.

Why it matters: The story of the 19th and 20th centuries was broadly one in which new wealth went mostly to the rich — both in terms of individuals and in terms of countries. That's now changing, fast.

By the numbers: Total wealth fell in 2022, as you'd expect in a year where both stock and bond markets fell dramatically. The world's private wealth ended the year at $454.4 trillion, modestly down from $465.7 trillion at the end of 2021.

  • Global median wealth, however — "a more meaningful indicator of how the typical person is faring," per UBS — went up by 3% in 2022.
  • "For the world as a whole, median wealth has increased five-fold this century," writes the report, "largely due to the rapid wealth growth in China."

Total global wealth is expected to rise by 38% in the next five years — with middle-income countries, rather than the ultra-rich, reaping the majority of the benefits.

  • While middle-income countries accounted for barely more than 5% of global wealth in 2000, that number is likely to reach 30% in 2027.
  • Low-income countries are likely to see wealth grow by 11.8% per year over the next five years, per UBS, while middle-income countries will grow their wealth at a 10.7% pace — far above the 4.5% growth rate seen in high-income countries.

Between the lines: The U.S. was part of 2022's global trend of the rich getting poorer and the poor getting richer. While U.S. boomers and Gen Xers saw their wealth decline in 2022, for instance, millennials got richer.

  • Similarly, Hispanic Americans saw their wealth rise in 2022 by almost 10%, while non-Hispanic whites saw their wealth decline. That's in large part because housing wealth was much more resilient than stock-market wealth, and Hispanic Americans have a greater percentage of their wealth in housing.

The bottom line: Wealth is increasingly a luxury available to the global middle classes. It's still low, across much of the planet, but it's growing impressively.

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