Trend: Rising global inequalities

A trend indicates a direction of change in values and needs which is driven by forces and manifests itself already in various ways within certain groups in society

While the other five micro trends described in this megatrend on 'Widening Inequalities' are globally relevant, they are described from a Eurocentric perspective. In this sixth micro trend, we take a broader look at global-level inequalities.

The burden of climate change is being unequally spread around the world and this can become a self-reinforcing vicious cycle. Income and wealth inequality is growing and can be further exacerbated by an unequal access to migration as a way to improve living standards, during and after the COVID-19 pandemic. An uneven reach of COVID-19 vaccines around the world may also drive inequalities. 
 

This Trend is part of the Megatrend Widening inequalities

Manifestations

Developments happening in certain groups in society that indicate examples of change. 

Climate change has uneven impacts 

It is well known that globally, the highest greenhouse gas emitting countries are the least vulnerable to climate change effects and that countries emitting the least amount of gases tend to be more vulnerable. Climate change is aggravating social inequalities. This applies both within and across countries. In a vicious cycle, initial inequality makes disadvantaged groups or countries suffer disproportionately from the adverse effects of climate change. It makes them more susceptible to the damage caused by climate hazards and subsequently decreases their capability to cope with and adapt to changes and recover from damages suffered.

Signals of change: JRC, McKinsey, UN DESA, Scientific reports, JRC

Global inequality of income and wealth is going up

Although many countries have reduced their numbers of people living in extreme poverty, global wealth and income inequality is growing. In the past decade alone the number of billionaires has doubled. The share of national income going to the top 10% of earners has either grown or stayed high in most parts of the world. Wealthier individuals are receiving higher returns for their wealth.

Decreasing numbers of children born, especially in developed countries, will result in wealth being transferred to fewer inheritors and this will drive greater concentration of wealth in the future. The concentration of wealth goes hand in hand with the concentration of power and with having too much influence on setting the rules of the game for everyone. This has become intensified by the COVID-19 pandemic. Excessive inequality threatens democracy and social cohesion and will eventually hold back economic growth.

Signals of change: World Inequality Lab, Inequality.org, ILO, World Bank

Access to global mobility could become even more uneven

Migration is closely related to large differences in income between countries. These differences increase individual gains from migration, and they turn migration into a powerful tool for reducing global poverty and inequality. The COVID-19 pandemic has led to severe restrictions on people’s ability to move, i.e. their mobility for work, study, family and for humanitarian reasons. Many countries depend heavily on the money that migrant workers send home. These financial flows (remittances) have been growing rapidly in recent years, but are now projected to decline due to the pandemic. This could make the economic crisis of some 'receiving' regions longer and deeper.

Signals of change: World Bank, JRC, IOM's GMDAC, JRC, Global Policy

Unequal distribution of COVID-19 vaccines will fuel different speeds of recovery

Equal access to COVID-19 vaccines and their coordinated distribution and uptake around the world will be key to stopping the pandemic. However, there are huge discrepancies between vaccine coverage in high-income countries and low-income countries where the coverage is many times lower. There are already signs that access to COVID-19 vaccines is turning into a geopolitical instrument. The situation when governments sign agreements with vaccine manufacturers to gain access to vaccines for their own populations, ahead of others has been described as ‘vaccine nationalism’. There are signs that this trend could hamper global access to vaccines and prolong both the pandemic and economic recovery and therefore further increase global inequalities.

Signals of change: WEF, McKinsey, WHO, OECD

Interesting questions

What might this trend imply, what should we be aware of, what could we study in more depth? Some ideas:

• Do we have adequate data to monitor wealth inequality?

• How much wealth and income inequality can society tolerate?

• Could focus on fighting the COVID-19 pandemic and its economic consequences lead to the neglect of other looming global crises?

  • If so, which ones are coming?