In twenty years, wealth inequalities have increased, notes INSEE, in a study published Thursday October 17. It states that in 2021, the bulk (92%) of the total wealth was held by half of households. And several elements are included: real estate (at 62%), financial, professional (businesses), durable (cars, household equipment) or other valuable objects… The least well-off (43%) have booklets. savings, those with an intermediate level have a main residence and the richest hold very diversified assets.
So how can we explain that the gap is widening? The rise in property prices, particularly in the early 2000s, has widened the gap between wealthier households and others. Between 1998 and 2021, “while real estate prices” have multiplied by 2.5, “the average gross wealth of the 10% of least endowed households has fallen on average by 2% per year, while that of 10% of the best-endowed households increased by 4%,” detailed the INSEE study.
Another conclusion of the study: the average level of assets held varies greatly depending on age. In 2021, INSEE indicates that it increases with age up to around 50 years, stabilizes, then decreases beyond 75 years for people living at home. However, the age at which wealth reaches its maximum has lengthened over time, while the peak arrived at 55 years in 1998, then around 60 years in 2010. A gap which can be explained by the lengthening of life expectancy and therefore obtaining later inheritances.
And this last parameter is crucial. In 2021, the average gross wealth (before deduction of loans) of households having inherited was almost twice as large as that of those having never received an inheritance (442,000 euros compared to 238,000 euros), adds INSEE in its triannual publication “household income and assets”. In total, three out of ten French people have inherited it during their lifetime.
Income inequality
Furthermore, if a household wants to buy real estate or expand its assets, it often has to resort to loans. However, in 2021, 10.1% did not have access to credit as they wanted over the previous three years. The reasons for this failure? Loan request refused, amount granted too low or they gave up on their own, anticipating a future refusal. “Certain households may have encountered several of these situations over the course of three years for different requests or different types of credit,” specifies INSEE.
Regarding income, “inequalities increased sharply between 2002 and 2021, due to the decline in the lowest incomes and the dynamism of high incomes”, indicates the report. However, after redistribution (tax collection and addition of social benefits), they are “almost stable” over the period, notes INSEE.
Furthermore, INSEE notes a gap in income depending on the age of the person and their marital status. In 2021, individuals who declared very low income are younger and less often in a relationship. “Among those declaring very low income, the proportion of 16-25 year olds is higher than in the population as a whole. Conversely, that of seniors aged 60 or over is lower than in the the entire population”, continues INSEE.
The Institute also provides an estimate of poverty extended to the entire French population. “Approximately 11.2 million inhabitants would be in poverty in France”, a figure higher than that of “monetary poverty” (9.1 million in 2022), published each year, which focuses on the metropolitan population, Anne Jaubertie, head of the Household Income division, explained to AFP. Among them, “around 2 million” are affected by “extreme poverty” and combine very low income with “material and social deprivation”.
Inequalities in the territory
And, unsurprisingly, these people are not distributed evenly across the territory. Very low-income families remain over-represented in the overseas departments (where their share exceeds 20%) as well as in densely populated areas. For comparison, this share is less than 10% in most departments of mainland France. Only certain Ile-de-France territories are an exception, such as Seine‐Saint‐Denis with 18%, as well as certain departments of Hauts‐de‐France, the Grand Est or the Mediterranean rim.
If inequalities are increasing, France remains far behind the United States where they are 60% higher or the United Kingdom and Spain where they are “25% to 40% higher than in France “, according to the study.