Findings of World Inequality Report:
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Top 10% earn 57% of national income, and within that top 1% earns 22% while the bottom 50% earn only 13% of the income.
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This deeply impacts social mobility. This has also translated to inequalities in education and the labour market.
What trends emerge from labour market analysis?
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Since the onset of the pandemic, there has been a decline in labour force participation. This means that despite a young population, the number of people looking for jobs has fallen.
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Over the same period, the unemployment rate has risen from 7.5% to 8.6%. So among those looking for jobs, those unable to find jobs, even at lower wages have risen.
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Among those in jobs, the casualization of labour has increased.
How does inequality affect social mobility?
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Rapid growth lowers the obstacles to mobility. But subdued or uneven growth leads to disproportionate benefits to richer people. For instance, there will be disparities in consumption, income, and wealth.
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According to ASER Report, the learning gaps between children from poor and affluent households will widen with inequality.
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This will lead to greater demand for redistribution. Thus, this scenario needs to be arrested for better social mobility.