The disparity in income between affluent and impoverished neighborhoods in the country is widening, with households at the higher end having nearly £87,000 more in disposable income annually compared to those at the lower end.
In Tower Hamlets, the Leamouth neighborhood stands out as the top-earning area, boasting an average post-tax disposable income of £107,600 for the financial year ending 2023. This upscale neighborhood, nestled between Canning Town and Canary Wharf, leads the nation in terms of household earnings, as per recent data from the Office for National Statistics.
Conversely, Sparkhill North in Birmingham reports the lowest average income nationally, with households in this area having a meager disposable income of just under £20,800 annually. This figure represents a significant £86,800 income gap when compared to Leamouth.
Notably, the income disparity trend has accelerated over the years. For instance, in the financial year ending 2020, the gap between the wealthiest and poorest neighborhoods was only £50,300 per year, indicating a substantial 73% increase in just three years.
Further highlighting the income disparities, neighboring areas within the same locality exhibit stark contrasts. In Tower Hamlets, Shadwell North has the lowest average disposable income, amounting to £33,800 annually, underscoring a £73,800 gap with Leamouth, which is the most significant income divide within a single local authority in the country.
The capital city, London, also showcases significant income gaps, with areas like Poplar Central reporting an average household disposable income of £35,000, notably lower than the neighboring Leamouth. Similarly, Southwark displays disparities, with Butler’s Wharf and Queen’s Walk reporting an average household disposable income of £100,900, contrasting with South Bermondsey East’s £37,600.
Across the country, Oxford, Salford, and Birmingham also present notable income disparities. Oxford Central leads with an average disposable income of over £87,300 annually, while Birmingham’s Central neighborhood reports £63,400 compared to Sparkhill North’s £20,800.
The income divide is underscored by data from the Office for National Statistics, which examines households’ combined disposable income after essential tax deductions. By aggregating data for small areas known as Middle Layer Super Output Areas, significant income discrepancies are revealed.
In Birmingham, the six lowest-earning areas are all concentrated, with Sparkhill North at the bottom of the list and other areas like Sparkbrook South, Small Heath Park, Saltley East, Washwood Heath, and Bordesley Green North following suit with similarly low average household incomes.
The income disparities extend beyond Birmingham, with different regions of the UK showing varying income distributions. In London, a substantial portion of neighborhoods rank in the top 10% nationally for average disposable household income, while regions like the North East present a different picture, lacking any neighborhoods in the top income bracket.
Areas like Wales and Yorkshire and the Humber have minimal representation in the top 10% income bracket nationally, contrasting with regions like the North West, West Midlands, East Midlands, and South West, which show slightly higher percentages in the top income bracket.
Conversely, a considerable percentage of neighborhoods in the North West, West Midlands, and North East find themselves in the bottom 10% nationally for income levels, emphasizing the diverse economic landscape across different UK regions.