More than five million people became millionaires globally in 2020, bringing the total to 56.1 million, according to Credit Suisse research. For the first time, over 1% of adults worldwide were millionaires, despite the economic damage caused by the Covid-19 pandemic.
The surge in millionaires was driven by recovering stock markets and soaring house prices, which boosted household wealth. Lower interest rates and government support programmes led to a significant transfer of wealth from the public sector to households, increasing savings and inflating financial assets.
However, wealth inequality widened, with poorer individuals seeing little benefit. Economist Anthony Shorrocks noted that if asset price increases were removed, global household wealth may have fallen. He warned that rising interest rates could eventually dampen asset prices.
The number of ultra-high net worth individuals, with assets over $30 million, grew by 24% in 2020, the fastest rate since 2003. Meanwhile, the middle class in emerging economies expanded, with the number of people holding between $10,000 and $100,000 more than tripling since 2000.
Credit Suisse's Nannette Hechler-Fayd'herbe acknowledged that government and central bank interventions averted a full-scale crisis but came at a great cost, with public debt rising by 20 percentage points or more in many countries.
