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Threats alerted as ultra-wealthy population booms

By Alexandra Newlove

The ultra-high net worth population is set to grow by more than 72,000 people over the next five years, with growth underpinned by urbanisation, female labour participation, and transformative technologies.

Threats to the ultra-wealthy include evidence of populist dissatisfaction with the elite, as well as potentially changing views on immigration, national sovereignty and deindustrialisation.

These were some of the key findings from Wealth-X's World Ultra Wealth Report 2017, published this week, which takes an annual look at the group of individuals worth more than $30 million each. This population numbered 226,450 in 2016 – 0.003% of the world's adult population. Of these, 48,830 were worth more than $100 million.

The report forecast that by 2021, there would be 299,000 people worth more than $30 million, with an additional $8.7 trillion of wealth created over this period.

“Growth drivers will include urbanisation, rising income levels, the 'premiumisation' of consumption, and an increase in female labour in developing markets, as well as the ongoing rapid adoption of transformative digital technologies around the world,” the report said.

While the number of individuals increased 3.5% on 2015, combined wealth grew 1.5% to $27 trillion, meaning the average net worth of the ultra-wealthy actually declined slightly.

North America held the highest proportion (36%) of UHNW individuals, with 81,700 people worth a combined $9.6 trillion. But Asia was playing catch-up, with the number of UHNW individuals based there growing 6.6% to 59,850.

Europe held 64,370 (28%) of the world's ultra-wealthy, a number that had declined slightly since 2015. Collective wealth in Europe was hit by a slump in the value of the sterling against the US dollar, largely due to the Brexit vote.

Most UHNW individuals were self-made, with 66.4% wealthy as a result of “fruitful business ventures or successful investments”.

Another 21.9% accumulated their money through a combination of inheritance and personal enterprise, while just 11.7% inherited their fortunes.

The UHNW population is still very male dominated. Women made up just 12.8% of those worth more than $30 million and were far more likely to have inherited at least some of their money.

“The past two decades of wealth creation have been driven largely by self-made individuals; without a sizeable influx of new females entrepreneurs, female representation is unlikely to change substantially,” the report said.

While philanthropy was the most common interest of the wealthy, just one-third were engaged with benevolent causes, with other common interests being sport, education, and the outdoors.

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