This chart shows how income inequality declined sharply in year one of the Covid recovery (2020-21) but was restored to its previous level in year two (2021-22).

It shows that, in year one (2020-21), inequality declined. The average income of the lowest 20% grew by 5.2% after inflation, compared with 3% for the middle 20% and 2.4% for the highest 20%. In year two (2021-22) this pattern was reversed. The average income of the lowest 20% fell by 3.5%, compared with a fall of 0.5% for the middle 20% and a fall of 0.1% for the highest 20%. When we compare average growth in incomes for the two-year recovery period from 2019-20 to 2021-22, these effects largely cancel each other out leaving little change in income inequality overall. The income of the lowest 20% grew by an average of 0.8% per year, compared with 1.3% per year for the middle 20% and 1.1% per year for the highest 20%.