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This study is part of the [Institute for Fiscal Studies] IFS Deaton Review of Inequalities, chaired by Angus Deaton, which aims to assemble the evidence on the causes and consequences of different forms of inequalities in the UK and the ways that they can best be reduced or mitigated. There will be two phases of work: commissioned studies and commentaries on a large number of key themes; the development of comprehensive and practical policy guidance.

This report seeks to set out the potential effects of the [Coronavirus Disease 2019] COVID-19 pandemic on inequalities in the UK. The pandemic has affected inequalities in education, training, wages, employment and health, including how these vary by gender, ethnicity, and across generations. It has also opened up new gaps along dimensions that were not previously widely considered, such as the ability to work at home. In this briefing note, we focus on two types of inequalities: first, inequalities in education and skills; second, inequalities in the labour market and household incomes. For each of these broad areas we highlight the challenges posed by inequalities between different groups and the opportunity for an integrated policy response. We examine inequalities in education and skills by gender, ethnicity, region and between people from different socio-economic backgrounds. In our analysis of inequality in labour markets and household incomes, we examine inequality across the income distribution, and again consider inequalities between the aforementioned groups.

We find evidence that three particular inequalities are likely to have risen because of the crisis: (1) income inequalities between richer and poorer households; (2) socio-economic inequalities in education and skills; and (3) intergenerational inequalities between older and younger people. The key drivers of these are the fall in employment resulting from the pandemic, which fall harder on younger and less well-educated people, and the massive decline in face-to-face learning that school children have faced. We discuss opportunities for an integrated policy response to these interrelated problems.

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