The COVID-19 pandemic could cause the biggest increase in global inequality on record, Oxfam warned in a new report Monday.
The health crisis has sparked a “simultaneous and substantial rise” in income and wealth inequality across dozens of countries, adding to the wealth of the world’s richest people while the poor lost their jobs and drained their savings accounts, the British anti-poverty group said.
Hundreds of millions more people could end up in poverty a decade from now if governments don’t make an effort to close the growing gap, according to the report, which aims to inform world leaders’ discussions at this week’s World Economic Forum conference.
“We stand to witness the greatest rise in inequality since records began,” Oxfam International executive director Gabriela Bucher said in a statement. “The deep divide between the rich and poor is proving as deadly as the virus.”
Oxfam’s report — titled “The Inequality Virus” — follows similar warnings about pandemic-fueled inequities from officials at the International Monetary Fund and the World Bank.
Oxfam’s report draws on a survey of economists around the world who broadly expect economic, racial and gender inequality to jump as a result of the COVID-19 crisis.
Some 87 percent of the 295 economists surveyed — including those from 77 of the 79 countries represented — said income inequality would “increase or strongly increase,” while 78 percent said the same about wealth inequality.
That may not be surprising given that the world’s 10 richest people reportedly saw their fortunes balloon by $540 billion in roughly nine months last year even though millions of workers lost their jobs amid lockdowns aimed at controlling COVID-19.
Moreover, some 56 percent of economists expect an increase in gender inequality as a result of the pandemic while roughly two thirds think racial inequality will grow, Oxfam’s survey found.
Oxfam contends that rising inequality could do long-term damage.
The group cited a World Bank analysis that showed if economic inequality as measured by the Gini coefficient — a gauge of income distribution — increases by 2 percentage points a year, 501 million more people would be living on less than $5.50 a day in 2030 than if inequality levels remained flat.
That would leave some 3.4 billion people living on that meager income about a decade from now, up from roughly 3.1 billion in 2019, before the pandemic hit, according to Oxfam’s report.
“Without decisive action, a major and widespread increase in economic inequality will leave a corrosive legacy, especially for the poorest and most marginalized people,” the report reads.