Dramatic stagnation to improvements in living standards affecting Scotland’s health

New research shows socioeconomic inequality in Scotland above average compared to other European countries

Press release

Improvements in living standards – which we had come to expect in the decades before 2010 – have stalled dramatically in Scotland since 2010, affecting the health of the population. At the same time, inequalities of earnings, income, wealth and education remain relatively high in Scotland, in comparison both to the past and to many comparable European countries.

These are the two key findings of a new report published by FAI today which explores trends since 1999 in the key factors that influence health.

The report argues that factors including financial security, the quality of housing and the local environment, education, and employment, can affect health in a wide variety of ways. Living in damp or overcrowded accommodation can affect health directly, whilst financial security can affect mental wellbeing, and influence people’s ability to engage in healthy behaviours.

Today’s report sets out that:

  • There has been an unprecedented stagnation of earnings and household incomes in Scotland (as in the UK) in the decade following 2009/10. Between 2009/10 and 2019/20, household disposable income grew at less than half the rate it had in the previous three decades. By 2021, typical weekly earnings were around £80 per week below what they would have been had long-run trends before 2010 continued.
  • Income inequality in Scotland, while lower than in the UK as a whole, is above the average of European countries. Inequalities of earnings, wealth and educational attainment are also relatively high in Scotland, and have remained persistently so for many years.

The report argues that these two key features of the Scottish economy are likely to influence future health in Scotland. Improvements in life expectancy in Scotland had already stalled from 2012, and health inequalities remain high – as discussed in a recent report from the University of Glasgow (‘Health inequalities in Scotland’, Miall et al. 2022).

Today’s report is part of a major programme of work to better understand trends in health inequalities in Scotland, and the wider determinants of health.

The Health Inequalities in Scotland: An independent review, is funded by the Health Foundation, working with Scottish research partners and an expert advisory group. The review aims to provide a robust evidence base for future policy development and delivery – action that will improve people’s long-term health and close the health gap between the richest and poorest.

Today’s Fraser of Allander Institute report aims to provide a comprehensive assessment of how inequalities in the socioeconomic determinants of health have evolved in Scotland over recent decades, with a particular focus on the period since 1999. The report argues that factors including financial security, the quality of housing and the local environment, education, and employment, can affect health in a multitude of ways.

Commenting on the report, David Eiser, Deputy Director at FAI and author of the report said:

“Scotland’s economy, like the UK’s, has been characterised by high levels of inequality for many decades. Since 2010, the economy has also been characterised by stagnating earnings growth and flatlining living standards.

“The health of the population, and health inequalities within the population, are shaped by social and economic circumstances.

“The similarities between Scotland’s economic and health trends are striking. Stagnation of improvement in incomes and living standards has coincided with a slowing of improvement on some health outcomes, including life expectancy and healthy life expectancy, and an increasing prevalence of mental health issues.

“The links between the economy and health are complex and work both ways. We’ve seen this in the context of Covid (where socio-economic circumstances influenced vulnerability to the disease), and the current cost-of-living crisis – which has the potential to affect health in a number of ways.”

David Finch, Assistant Director at the Health Foundation, said:

“Today’s report represents a comprehensive attempt to map and assess trends in a wide range of the socioeconomic determinants of health in Scotland including incomes and poverty, wealth and debt, employment and education, housing and more.

“Across these areas the message is clear. Inequalities are high, and progress has slowed. Addressing socioeconomic inequalities and improving living standards will be key to making meaningful progress in towards improving the health of Scotland.”

Chris Creegan, Chair of the Expert Advisory Group, said:

“Today’s report reiterates the critical importance of wider socioeconomic factors in influencing health and stubbornly high health inequalities.

“Today’s report sets out a strong evidence base.  The Health Foundation’s report, to be published in January, will consider evidence from the review and focus on how Scotland can build on strong policy intent to create a sustainable approach to closing the gap in health outcomes.”

Other findings from the report include:

  • The proportion of people in Scotland living in poverty did fall throughout the first decade of the 2000s, but has begun to increase again since the mid-2010s. Some groups are consistently more likely to be in poverty than others. Rates of food insecurity for example are particularly high amongst single parents. Living in poverty is associated with lower life expectancy, and greater risk of diet-related problems, chronic illness and mental health problems.
  • Earnings inequality has fallen slightly in Scotland during the past decade. But earnings inequality remains at least on a par with equivalent measures for European countries, and there has been some rise in insecure forms of work. The characteristics of a job – its pay, security, and autonomy – can influence on health and wellbeing.
  • Socioeconomic background continues to play a strong role in influencing educational attainment and participation in Scotland, with mixed evidence of improvement.
  • Wealth inequality in Scotland is high. 45% of wealth is held by ten per cent of households, whilst a tenth of households have no, or negative wealth. Wealth can influence health through the way it affects financial and housing security.
  • Over the past 20 years, housing costs have tended to increase relatively more for those in the private rented and social rented sectors, relative to those in owner occupation. Living in a damp or cold home can affect health directly, whilst housing costs and security can influence anxiety and mental wellbeing.
  • A slowdown in spending on public services – including health and social care – since 2010 seems likely to have contributed to a contemporaneous slowdown in improvement in public health. Cuts in social security spending since 2010 may have contributed to a rise in the proportion of people suffering from mental health problems.


David is Senior Knowledge Exchange Fellow at the Fraser of Allander Institute



Emma Congreve is a Principal Knowledge Exchange Fellow and Deputy Director at the Fraser of Allander Institute. Emma's work at the Institute is focussed on policy analysis, covering a wide range of areas of social and economic policy.  Emma is an experienced economist and has previously held roles as a senior economist at the Joseph Rowntree Foundation and as an economic adviser within the Scottish Government.

Ciara is an Associate Economist at the Fraser of Allander Institute. She has a broad research experience across different areas including poverty and inequality, the voluntary sector, health, education, trade, and renewables and climate change. Ciara has an MSc in Applied Economics (Distinction) and a first-class BA Honour’s degree in Economics and Finance, both from the University of Strathclyde.

Allison is a Fellow at the Fraser of Allander Institute. She specialises in health, socioeconomic inequality and labour market dynamics.