{"id":120582,"date":"2026-05-17T12:15:00","date_gmt":"2026-05-17T11:15:00","guid":{"rendered":"https:\/\/en.econostrum.info\/uk\/?p=120582"},"modified":"2026-05-17T11:17:32","modified_gmt":"2026-05-17T10:17:32","slug":"uk-growth-slump-leaves-younger-generations","status":"publish","type":"post","link":"https:\/\/en.econostrum.info\/uk\/uk-growth-slump-leaves-younger-generations\/","title":{"rendered":"UK Growth Slump Leaves Younger Generations Falling Further Behind"},"content":{"rendered":"\n

Britain\u2019s weak growth and widening social divides are feeding political instability, according to former Institute for Fiscal Studies director Paul Johnson<\/a>. He argues that years of underinvestment, planning restrictions, and uneven wealth gains have left the country struggling to improve living standards.<\/p>\n\n\n\n

The UK\u2019s economic model is facing mounting pressure as public spending rises, growth slows, and younger generations fall behind their parents financially. According to Johnson, the country risks entering a cycle in which stagnation <\/strong>and political disillusion reinforce one another.<\/p>\n\n\n\n

The warning comes from Johnson\u2019s latest book, Challenging Inequalities: How We Got Stuck and Where We Go Next<\/em>, produced as part of a long-running Institute for Fiscal Studies project examining inequality in Britain. Speaking to MoneyWeek<\/strong>, Johnson said the research drew on more than 100 papers overseen by a committee chaired by Nobel Prize-winning economist Angus Deaton.<\/p>\n\n\n\n

While some traditional measures suggest inequality has remained relatively stable since the 1990s, Johnson said the picture changes when focusing on top earners and wealth concentration. The richest 1% continued to pull away from the rest of the population until around the 2008 financial crisis, even as broader income inequality plateaued.<\/p>\n\n\n\n

Growth Slowdown and Rising Inequality Reshaped Public Frustration<\/strong><\/h2>\n\n\n\n

According to Johnson, the main driver behind Britain\u2019s political discontent is not inequality alone but the prolonged absence of economic growth<\/strong>. He told MoneyWeek that living standards have failed to improve for many households over the past two decades, while wealthier groups continued accumulating income and assets at a faster pace.<\/p>\n\n\n\n

Johnson noted that younger generations are increasingly affected because earnings growth has not kept pace with rising housing costs. He said concerns about inequality become sharper when people feel they are no longer advancing economically.<\/p>\n\n\n\n

The book argues against relying solely on tax redistribution to reduce inequality. Instead, Johnson advocates what he describes as \u201cpre-distribution<\/strong>,\u201d focused on improving the structure of the economy <\/a>before inequalities emerge. According to the interview, the proposals include strengthening early-years education, improving family support, expanding housebuilding, and addressing regulation affecting major companies.<\/p>\n\n\n\n

Johnson also discussed immigration and globalization, describing them as forces that can support growth while also contributing to inequality if poorly managed. He said recent immigration policy has been inconsistent, pointing to the expansion of care-worker visas and continued family migration.<\/p>\n\n\n\n

Artificial intelligence<\/strong> could deepen these divisions, Johnson warned. According to MoneyWeek, he said the United States already shows signs that technological change can create highly concentrated gains benefiting a small group of companies and individuals through salaries, stock options, and economic rents.<\/p>\n\n\n\n

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Min wage is much lower fraction of median earnings in e.g. Oxford and Reading than Doncaster and Wigan. In former still just 1 in 10 earn at or close to minimum. In latter it's 1 in 4 or more.
Min wage is *82%* of median in Doncaster.
V different effects in local labour markets. https:\/\/t.co\/inN0lHZsUB<\/a> pic.twitter.com\/n9toxhAH7o<\/a><\/p>— Paul Johnson (@PJTheEconomist) May 14, 2026<\/a><\/blockquote>