Finance Finance News The rich get richer: Billionaire wealth hits record high during COVID

The rich get richer: Billionaire wealth hits record high during COVID

Billionaire wealth has hit a new record high, according to a new report by UBS.
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The wealth of the world’s billionaires has reached record highs after global sharemarkets surged during the pandemic.

Days after the World Bank revealed its measure of extreme poverty would rise for the first time since 1998, UBS investment bank and PricewaterhouseCoopers have released a new report showing billionaires are richer than ever.

Total billionaire wealth across the world rose by 27.5 per cent during the early stages of the pandemic and hit a record $US10.2 trillion ($14.2 trillion) on July 31.

That’s up from the previous record of $US8 trillion ($11.2 trillion) set in 2017, and almost five times more than Australians hold in their superannuation accounts ($2.9 trillion).

But some did better than others.

Tech billionaires increased their wealth by 41.1 per cent over the same period, as people worked from home and bought goods and services online, while real estate (up 12.9 per cent) and finance billionaires (up 12.8 per cent) lagged the pack.

The report said the “polarising fortunes” marked a noticeable shift from the previous decade – during which a rising tide lifted all billionaire yachts equally.

“Most of the decade was a time of exceptional prosperity for billionaires regardless of sector, but in the last two years those using technology to change their business models, products and services have pulled ahead,” the report authors wrote.

“The COVID-19 crisis just accentuated this divergence.”

The report doesn’t rank the 2189 billionaires whose wealth it tracked, but separate research by Bloomberg shows the richest person on the planet is Jeff Bezos, the founder of US tech giant Amazon.

So far this year, his wealth has increased by $US73.6 billion ($102.8 billion) on the back of a 68 per cent jump in Amazon’s share price.

His personal fortune now amounts to $US189 billion ($263.9 billion).

The founder of Tesla, Elon Musk, has had a more profitable 2020.

Though he is worth less than Mr Bezos ($US103 billion or $143.8 billion), this year his fortune soared by $US75.5 billion ($105.4 billion), thanks to a massive run-up in the price of Tesla’s shares.

The UBS report said Mr Musk’s companies “are respectively pioneering the mass-market electric car and private space travel”.

Meanwhile, its research shows billionaires “are giving more than at any time in history” – with many “putting renewed energy and wealth into tackling the environmental and social problems that the pandemic and recent natural disasters have highlighted”.

“Our research has identified 209 billionaires who have publicly committed a total equivalent to $7.2 billion from March to June 2020,” the report said.

“They have reacted quickly, in a way that’s akin to disaster relief, providing unrestricted grants to allow grantees to decide how best to use funds.”

And there has been time for introspection, too.

As the coronavirus claimed hundreds of thousands of lives and brought  entire economies to a standstill, billionaires pondered their own mortality.

“There has been a notable uptick in succession planning,” the UBS report notes.

“Many billionaire families didn’t have a formal process, but the partners surveyed [by a PwC study] ranked succession planning as the most likely priority for these clients in the next 12 months.”

Or, as a Singaporean billionaire put it: “The crisis has reminded us how unexpected the world and life can be. Neither life nor success can be taken for granted.”