It’s true that each one huge cities have areas of poverty that’s seen from the streets. However I’m all the time a bit shocked after I journey to London, the place I’m presently working, as a result of the inequality could be very apparent. As I work extra on the degrowth, decolonisation undertaking that I’m presently concerned in, one factor turns into paramount. An awesome proportion of the entire fossil gasoline power utilization is as a result of consumption of the wealthiest households. And to dramatically cut back our ecological footprint would require dramatically decreasing the capability of the highest finish of the earnings and wealth distributions to eat power. Nevertheless, all of the developments are shifting in opposition to that requirement. Listed below are some notes on that matter.
The March 2023 version of the educational journal Ecological Economics (Vol 208) revealed an article – Social outcomes of power use in the UK: Family power footprints and their hyperlinks to well-being – written by a number of educational researchers (largely affiliated with Leeds College).
The motivation was apparent – “Present power consumption is simply too excessive to keep up international warming inside 1.5 levels with out resorting to large unfavourable emissions”.
The wrongdoer was “overconsumption”, significantly within the ‘International North’, which in accordance with Wikipedia article – International North and International South – “broadly contains Northern America and Europe, Israel, Japan, South Korea, Australia, and New Zealand” – which means the North-South divide shouldn’t be primarily based on latitude.
The International North is code for wealthier nations which have entry to best-practice know-how.
The research begins with the statement that:
We all know that power use and carbon emissions related to it are extremely unequally distributed, with the highest 10% of earnings earners (largely within the International North) accountable for 49% of all carbon dioxide emissions …
There’s a mass of credible analysis proof that helps that competition.
We have now recognized that for a very long time.
On December 2, 2025, Oxfam revealed a Media Briefing – Excessive Carbon Inequality – which discovered that:
Local weather change is inextricably linked to financial inequality: it’s a disaster that’s pushed by the greenhouse gasoline emissions of the ‘haves’ that hits the ‘have-nots’ the toughest …
… the size of this inequality counsel that the poorest half of the worldwide inhabitants – round 3.5 billion folks – are accountable for solely round 10% of complete international emissions attributed to particular person consumption …
The common footprint of the richest 1% of individuals globally could possibly be 175 occasions that of the poorest 10% …
In order stark as these estimates are, additionally they inform us how difficult a degrowth technique will likely be to implement provided that it requires considerably diminished power utilization, which, in flip, implies that coverage motion should be targetted in the direction of the excessive ends of the wealth and earnings distributions within the wealthier nations.
The Ecological Economics article cited above sought to analyze the distributional traits of power utilization throughout the UK.
I gained’t talk about the technical facets of the research that are attention-grabbing and there are progressive methods introduced to beat information limitations.
Their analysis linked power use to “wants satisfaction and well-being”, which supplies one other dimension to the inequality dialogue.
They discovered:
1. “There’s a nine-fold distinction in power use between the bottom and prime EF decile” (EF is the power footprint).
2. A lot of the power utilization variations by earnings cohort come up from differential charges of personal transportation utilization. The decrease deciles eat most of their power of their properties, whereas the upper deciles eat lots of worldwide journey along with having bigger properties.
3. “The underside 10% of power customers contribute solely 2% to the entire power use, and solely 5% of the highest 10% customers’ utilization. The underside half of power customers are accountable for simply one-fifth of complete power use. That is lower than the share of the highest 10% of power customers, which is over a one third of complete power use.”
4. By way of well-being and power use, the poorest shortly grow to be higher off as they eat extra power however the good points taper off as power utilization will increase.
5. “some households use so little power that they can’t obtain excessive well-being, whereas others use over ten occasions extra” – and the wealthier households well-being could possibly be achieved at a lot decrease ranges of power consumption.
6. “excessive well-being is feasible to attain … [with energy consumption that] … is lower than the nationwide common power footprint (EF)” = which means that extra power utilization shouldn’t be important to having excessive ranges of well-being regardless of perceptions.
The sensible coverage drawback is to get governments to begin coping with the inequality as a necessary step in a degrowth trajectory.
After all, my confidence stage on reaching that requirement could be very low.
The neoliberal interval ended the a number of a long time of inequality discount that had been achieved by social democratic authorities coverage geared toward rising transfers, offering low cost and top quality public companies, increasing public schooling and well being, and making certain wages progress was in a position to replicate productiveness progress (which means actual wages grew significantly).
The neoliberal takeover of governments sought to reverse or retrench these initiatives to permit the share that capital will get out of nationwide earnings to rise once more.
There are a number of dimensions to this concerted marketing campaign to finish social democratic inequality discount.
I’ve been inspecting the UK information whereas I’m right here in London (as background to numerous conferences and so forth) and it’s clear that authorities coverage has prioritised capital over labour.
The British Workplace of Nationwide Statistics (ONS) information – Labour share of earnings: Complete financial system SA: share: UK (revealed February 17, 2026) – reveals that within the third-quarter 1973, the labour share in earnings for the UK was 71.9 per cent.
It now stands at 59.7 per cent and had fallen to as little as 53.3 per cent (December-quarter, 1996).
The revenue share has risen commensurately.
Take into account the actions within the Monetary Occasions Inventory Alternate Index (FTSE 100) – which is a market index of the 100 largest firms traded on the London Inventory Alternate.
When it was launched on January 3, 1984, it had a price of 1000.
The next graph tracks the month-to-month index ranges since February 2000.
Except for the most important cyclical occasions proven (GFC, Pandemic), the FTSE 100 has been on an ever rising journey upwards.
What’s the common return on the FTSE 100?
The info reveals (Supply):
The full shareholder return is arguably the superior metric, because it counts all returns from investing within the FTSE 100. Within the 20 years from 2003 to 2023, FTSE 100 complete shareholder returns got here in at 241%, producing a median return of 6.3% on an annualised foundation, together with dividends.
Throughout the Atlantic, the S&P 500, which is an index monitoring the biggest 500 companies within the US, delivered an “common of 10.26% per 12 months since its fashionable inception in 1957 by to the tip of 2023.”
What about actual returns (after accounting for inflation)?
The info reveals that:
For those who contemplate the annualised 6.3% return over the previous 20 years, after which subtract the common inflation fee of two.8% over the identical timeframe, you then get a median actual annualised return of three.5%.
Now examine that to actual wages progress over the identical interval within the UK?
The ONS dataset – EARN01: Common weekly earnings – supplies a desk of actual common weekly earnings.
The annual common progress fee in common pay between January 2023 and December 2025 is 0.64 per cent each year.
In different phrases, hardly something in any respect.
For those who return and take a look at the FTSE 100 graph, you’ll observe a dramatic enhance since about October 2020.
The common annual enhance in nominal phrases of the FTSE 100 between October 2021 and January 2026 was 7.94 per cent, in comparison with a median annual inflation fee of 5.5 per cent over the identical interval.
Thus an actual return of two.5 per cent.
Over the identical interval, actual common weekly earnings rose by 0.27 per cent each year.
And whereas the share market continues to growth, the UK Guardian article (February 17, 2026) – UK unemployment fee hits five-year excessive of 5.2% as wage progress cools – tells a distinct story for staff.
And the most recent information on job vacancies within the UK reveals that “The variety of job vacancies within the UK has tumbled to the bottom stage in 5 years” and “Graduate jobs fell under 10,000 for the primary time since Adzuna started monitoring this in 2016” (Supply).
The newest ONS – Labour market overview, UK: February 2026 (revealed February 17, 2026) – additionally reveals that the British labour market is offering declining alternatives that fulfill the preferences of staff.
The next graph reveals the charges of underemployment and overemployment within the UK because the March-quarter 2002 to the December-quarter 2025.
Underemployment captures staff who wish to work extra hours however the labour market is simply too weak to supply them.
Overemployment captures staff who’re working too many hours per week, and that is typically on account of punitive working circumstances being imposed.
The underemployment fee was 8.6 per cent within the December-quarter 2025 and the overemployment fee was 10 per cent.
So 18.6 per cent of these employed weren’t proud of the hours they had been presently being compelled by the ‘market circumstances’ to work.
Within the March-quarter 2024, that proportion was 15.1 per cent.
If we mix the underemployment with the current official unemployment fee of 5.2 per cent, we get a broad underutilisation fee of 13.8 per cent, which is the slack that’s obtainable to work extra.
And put that within the context of the newest ONS information (revealed February 20, 2026) – Public sector funds, UK: January 2026 – which revealed that:
Preliminary estimates present that the general public sector recorded a £30.4 billion surplus in January 2026, £15.9 billion greater than, or double that of January 2025, and £6.3 billion above the Workplace for Funds Duty’s November 2025 forecast; the very best surplus in any month since data started in 1993 …
The federal government remains to be in deficit for the 12 months however it’s contracting shortly.
So rising labour market slack, flat actual wages progress (heading south), booming share market and company income – and meaning earnings and wealth inequality is rising.
And the implications for decreasing power utilization are clear.
Additionally clear is what’s required for a degrowth technique to work.
Conclusion
It’s apparent {that a} profitable degrowth technique would require a large redistribution of earnings and wealth.
Meaning dismantling the neoliberal establishments which have overseen a large shift in the direction of greater earnings and wealth inequality.
How that may occur is a subject for additional posts.
However it’s unlikely to be achieved inside a capitalist system, which makes the duty however harder certainly.
London occasion this week – Wednesday, February 25, 2026
I’m talking on the launch of the brand new Fashionable Financial Idea (MMT) centered group within the UK – MMTUK Coverage Analysis Group – on February 25, 2026 in London. I hope to see as most of the MMT crowd as attainable on the launch.
The occasion is open to the general public however the capability of the venue could be very restricted.
Please observe this – LINK for tickets (that are free).
Given the capability dimension of the venue, please don’t register for a ticket if you’re in any respect unsure of your intention to mean
The occasion particulars are:
MMTUK Launch Occasion: A Job Assure for Britain
Begin: Wednesday, February 25, 2026 19:00
Finish: Wednesday, February 25, 2026 to 21:00
Location: Associates Assembly Home, 173-177 Euston Highway, London, NW1 2BJ GB
Host Contact Data: contact@mmtuk.org
The venue is correct reverse Euston Station, on Euston Highway.
I hope to meet up with all our MMT associates in London throughout this go to.
The MMTUK Coverage Analysis Group is a really promising improvement and I hope they garner widespread assist.
That’s sufficient for at present!
(c) Copyright 2026 William Mitchell. All Rights Reserved.
