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Eighty two percent of the wealth generated last year went to the richest one percent of the global population, while the 3.7 billion people who make up the poorest half of the world saw no increase in their wealth, a new Oxfam report states.
The report was launched as high level political and business figures gathered at Davos, Switzerland for the World Economic Forum.
The report entitled “Reward Work, Not Wealth” shows how the global economy enables the wealthy elite to accumulate vast fortunes while hundreds of millions of people are struggling to survive on poverty pay.
Billionaire wealth has risen by an annual average of 13 percent since 2010 – six times faster than the wages of ordinary workers, which have risen by a yearly average of just two percent. The number of billionaires rose at an unprecedented rate of one every two days between March 2016 and March 2017.
According to Winnie Byanyima, Executive Director of Oxfam International, the billionaire boom is not a sign of a thriving economy. “It is a symptom of a failing economic system. The people who make our clothes, assemble our phones and grow our food are being exploited to ensure a steady supply of cheap goods, and swell the profits of corporations and billionaire investors,” She said.
The report outlines the key factors driving up rewards for shareholders and corporate bosses at the expense of workers’ pay and conditions. These include the erosion of workers’ rights; the excessive influence of big business over government policy-making; and the relentless corporate drive to minimize costs in order to maximize returns to shareholders.
Data shows that it would cost USD 2.2 billion a year to increase the wages of all 2.5 million Vietnamese garment workers to a living wage. This is about a third of the amount paid out to wealthy shareholders by the top 5 companies in the garment sector in 2016.
Women workers often find themselves at the bottom of the heap. Across the world, women consistently earn less than men and are usually in the lowest paid and least secure forms of work. By comparison, 9 out of 10 billionaires are men.
“Oxfam has spoken to women across the world whose lives are blighted by inequality. Women in Vietnamese garment factories who work far from home for poverty pay and don’t get to see their children for months at a time. Women working in the US poultry industry who are forced to wear nappies because they are denied toilet breaks,” said Byanyima.
The report advices that governments ensure that the wealthy pay their fair share of tax through higher taxes and a crackdown on tax avoidance, and increase spending on public services such as healthcare and education. Oxfam estimates a global tax of 1.5 percent on billionaires’ wealth could pay for every child to go to school.
Results of a new global survey commissioned by Oxfam, demonstrates a groundswell of support for action on inequality. Of the 70,000 people surveyed in 10 countries, nearly two-thirds of all respondents think the gap between the rich and the poor needs to be urgently addressed.