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There has been a promising decline in wage inequality in two thirds of countries since 2000, as per a recent report by the International Labour Organization (ILO). However, it emphasises that substantial wage disparities remain across the globe, particularly between high and low income countries.
Wage inequality has decreased at an average annual rate of 0.5 to 1.7 per cent, with the most significant reductions observed in low income nations, where annual decreases ranged from 3.2 to 9.6 per cent over the past two decades, according to the report titled ‘Global Wage Report 2024-25: Is wage inequality decreasing globally?’
In wealthier countries, wage inequality has shrunk at a slower pace, with reductions of 0.3 to 1.3 per cent annually in upper middle income countries and between 0.3 to 0.7 per cent in high income countries. Despite the overall decline in wage inequality, the ILO notes that the decrease has been more significant among high wage earners, and the lowest paid workers continue to face considerable challenges.
Globally, the lowest paid 10 per cent of workers earn just 0.5 per cent of the global wage bill, while the highest paid 10 per cent earn nearly 38 per cent. Wage inequality is the highest in low income countries, where close to 22 per cent of wage workers are classified as low paid.