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The Mayor of London The London Assembly

Measuring Economic Fairness in London

The Mayor of London is clear that a fair economy would be one where opportunity and prosperity are shared, so every Londoner can benefit from the city’s success. To achieve this, discrimination and disadvantage must be acknowledged and tackled. Inequalities must be recognised and reduced.

As part of meeting this objective, it is necessary to identify inequality and unfairness in London’s economy. A set of measures has been compiled and presented as a microsite within the London DataStore to provide access to a wide range of data that can be used to identify and to track progress on a range of relevant aspects, for different groups of Londoners. These measures are considered under three umbrella themes:

Living Standards

Labour Market that works for everyone

This theme is concerned with data on London’s workforce and experience of employment, and so includes workplace and employer-based measures. Pay differentials of various kinds and fair employment practices are highlighted in this theme. As well as contextual information on the state of economic fairness in London and nationally, it features data on similar aspects of the GLA group, where the aim is to lead by example.

Living Standards

Equal Opportunities

Ensuring that opportunities are available for all Londoners is central to this theme, which looks at experiences of all those living in London across a wider life span, considering life chances from early education through to differential access to appropriate employment and training and some key inequalities in income and wealth, which affect longer term prospects for individuals.

Living Standards

Raising Living Standards

It has long been acknowledged that London has severe inequalities in terms of living standards, so this theme includes information relating to the financial situations of the full spectrum of London households, concerning income and essential costs, poverty, debt, homelessness and the tools to achieve financial access necessary for modern living.

The measures give a broad picture across this range of dimensions, and many are tracked over time. They are not intended to serve as a means of tracking the Mayor’s performance in addressing unfairness – for many of these issues, it is national government that holds that responsibility, through its public spending decisions or stewardship of the economy. Many are difficult and slow to change, but tracking differences to be aware of movement provides the information that will help the Mayor to hold to account those with the ability to take action. The Mayor is, however, committed to doing everything within his power to make London a fairer, more inclusive city. These measures, and particularly the detail available, will also help the Mayor to check that his priorities are the right ones. Where relevant, data has been included on the performance of the GLA Group of organisations to show the extent to which the organisations controlled by the Mayor are leading by example. A further aspect of this collection of measures is that further detail is being provided to look at experiences of different groups within each topic. It is an evolving suite of statistics and over time more measures and further breakdowns will be added, along with links to initiatives that the Mayor is taking.

Some of the ways in which London differs from the national picture and how fairness is changing are already apparent in the data, though the pattern is mixed. London has a much better qualified population than the national picture. This is apparent at all levels of education – from early years through to qualifications among the adult population – just one in eight working age adults in London has no or very low qualifications, compared with one in six in the UK as a whole. Graduates are also more likely to be working in a job requiring that level of education in London than graduates elsewhere. The differences in GCSE attainment for London compared with England as a whole are apparent across all disadvantaged groups, although there are still differences to those from more advantaged families.

The gender pay gap in London is decreasing over time and is lower in London than the UK wide gap, though the ethnicity pay gap is higher in London than the rest of the UK. The employment gaps, defined as the difference between the proportion of residents in work in group compared with another – men compared with women, White compared with Black and minority ethnic residents, disabled compared with non-disabled, parents compared with adults without children, are all higher in London, but are all reducing. An increasing proportion of Londoners are underemployed (working part time because they can’t find a full-time job) or in insecure employment and unemployment is higher in London than the national average.

Energy efficiency is improving in London and is best in social housing and worst in owner occupied housing, with the level of fuel poverty in London (10 per cent) marginally below the level in England as a whole (11 per cent).

Costs of childcare, homelessness, families in arrears on household bills and material deprivation are all higher in London, but insolvencies are lower. Poverty, including persistent poverty is also higher in London and relative poverty is remaining stubbornly high, particularly among children and is increasing again for the other age groups.

Particularly striking are the inequalities in income and wealth for London’s households. Six out of ten households have either no savings or savings below £1,500, which is roughly equivalent to an average monthly cost of rent in London, although around half this proportion said they would not be able to meet an unexpected, but necessary bill of £800. London’s poorest households have lower income after paying the essential costs of housing than those elsewhere, despite facing higher costs in other aspects too (10 per cent of London households have less than £111 per week after housing costs), while Londoners at the other end of the income scale have much higher incomes, even after their housing costs than the rest of the UK (the top ten per cent in London have an income over £1,069 per week – nearly ten times as much). Similarly, London’s households in the richest tenth of all households in the UK own more than 60 per cent of all London’s household wealth, a much higher proportion than the national figures, while the poorest half of all households own just four per cent of London’s wealth between them.

Income Inequality

Wealth Inequality