Brexit vote wiped $1.5tn off UK household wealth in 2016, says report
Oxfam criticises rising inequality as Credit Suisse finds about 400,000 Britons have lost their status as dollar millionaires
The UK saw $1.5tn (1.2tn) wiped off its wealth during 2016 after the Brexit vote sent the pound tumbling and the stock market into reverse, according to a survey by Credit Suisse.
A fall in values at the top-end of the property market also contributed to about 400,000 Britons losing their status as dollar millionaires and one of the biggest drops in wealth among the major economies.
But the UK remained third for the number of ultra-high-net-worth individuals, who own more than 50m in assets, behind the US and China.
Across the globe, the richest 1% own more wealth than the rest of the world put together, continuing the dominance seen in last years report. A recovering in the global stock markets in recent weeks is also likely to reverse some of the losses suffered by pension savers and wealthy individuals.
Oxfam said the huge gap between rich and poor was undermining economies, destabilising societies and holding back the fight against poverty.
It said a separate study by the investment bank showed the UKs top 1% richest people continued to own 24% of the nations wealth.
The findings from the Credit Suisse Research Institutes seventh annual global wealth report that found the overall growth in global wealth remained flat in 2016, following a trend that emerged in 2013 and contrasting sharply with the double-digit growth rates witnessed before the global financial crisis of 2008.
Michael OSullivan, chief investment officer in Credit Suisses wealth management arm: The impact of the Brexit vote is widely thought of in terms of GDP but the impact on household wealth bears watching.
Since the Brexit vote, UK household wealth has fallen by $1.5tn. Wealth per adult has already dropped by $33,000 to $289,000 since the end of June. In fact, in US dollar terms, 406,000 people in the UK are no longer millionaires.
The report found that total global wealth in 2016 edged up 1.4%, or $3.5tn, to $256tn in line with the increase in the worlds adult population. Accordingly, average wealth per adult of $52,800 remains in line with last years figures.
The number of millionaires globally increased by 155%, while the number of ultra-high-net-worth individuals has risen by 216%, making them by far the fastest-growing group of wealth holders.
More than 90% of the wealthiest people in the world live in developed nations, mostly the US, but the rise of millionaires and ultra-high-net-worth individuals (UHNWIs) in China meant there was a shift to emerging economies in recent years.
Credit Suisse said: This century, no other segments of the wealth pyramid have developed as significantly as the millionaire and UHNWI segments. The number of millionaires is projected to reach 45.1 million by 2021, while the number of UHNWIs could reach 208,000, up from 141,000.
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The US hosted the highest number of UHNWIs with 56,000 followed by China with around 9,000, the UK in third place with 5,000.
Oxfam said it was clear from the survey that the wealthiest are holding their own while those on lower incomes are struggling.
Spokeswoman Sally Copley said: The wealthiest one percent of the population – who own nearly a quarter of all the countrys wealth continue to do well whilst so many people in Britain are just about managing to stay above the poverty line.
Tomorrows autumn statement presents a real opportunity for the government to show how they are going to make the economy work for everyone and not just those at the very top, she said.
This article was amended on 22 November to clarify that the figure for the top 1% richest people owning 24% of the nations wealth came from a separate Credit Suisse report
Read more: https://www.theguardian.com/business/2016/nov/22/brexit-vote-uk-household-wealth-credit-suisse