The Rich Got a Bit Poorer Last Year

The wealthy took a big hit last year.

The global population of billionaires sank for the first time since 2018, dropping 3.5% to 3,194, while their wealth declined by 5.5% to US$11 trillion, London-based Altrata, a data firm focused on the rich, reported in its annual Billionaire Census earlier this week.

The drop in wealth was the second-largest fall in the last decade, although Altrata noted that it only partially offset a double-digit jump in billionaire wealth in 2021. The company’s report draws from data collected by its Wealth-X unit.

Zooming out, the global population of those with US$1 million or more in assets fell by 3.3% to 21.7 million individuals, while their wealth sank by 3.6% to US$83 trillion, Paris-based Capgemini, an information technology and services consulting company, said in its annual World Wealth Report released on Thursday. The drops are the biggest in 10 years, Capgemini said.

The population of the ultra-rich, those with at least US$30 million in assets, fell the most, sinking 4.6% last year after a 9.6% surge in 2021, the company said. The wealth of this group of 210,000 individuals fell by 3.7% last year.

Altrata noted that billionaires represent just 0.8% of those with at least $30 million or more in net worth, yet they have a 24% share of this group’s total wealth.

Both Altrata and Capgemini credit slumping economies, falling stock markets, rising interest rates, and geopolitical tensions as contributing to the declines. The reports also both noted that many of the world’s richest responded by turning to wealth preservation strategies.

Among billionaires, this had mixed results, Altrata said. Those who made their money in technology, healthcare, and real estate lost more than 5% of their wealth last year, while those whose wealth accumulated through aerospace and defense, construction and engineering, and food and beverage, saw their fortunes rise, the company said.

According to Capgemini, two-thirds of those with US$1 million or more turned to wealth preservation by cutting their stock holdings by nearly six percentage points to 23% of their total portfolios and boosting their cash and cash-equivalent holdings by almost 10 percentage points to 34% as of January this year.

While global and domestic economies, capital markets, and currency movements affect all the rich, Altrata noted that gains or losses are also due to individual strategies for business and investments, wealth planning, taxes, and philanthropy.

“No billionaire’s asset structure is the same as another’s, and the impact on their wealth will be different for each person,” the report said.

The Billionaire Census also reported that the richest of all, those with US$50 billion or more, lost 23.2% of their wealth, while those at the bottom of the pyramid, with US$1 billion to US$2 billion in assets (representing just over half of all billionaires), lost 3.2%.

Most billionaires, 955, live in the U.S., although the population dropped by 2.1% last year. There are 357 billionaires in China, down by 10.8% and 173 in Germany, down by 1.7%. The only population gains reported last year were in Singapore, which now has 54 billionaires, up by four; and in Moscow, which has 76 billionaires, up by one.

The average age of the world’s billionaires is 67, with those under 50 accounting for just 10% of the total, Altrata said. There are more female billionaires under 50 than over, although they comprise just under one-fifth of the under-50 group.

While the population of rich individuals, and their total wealth, dropped in Europe, Asia Pacific, and North America last year, both the population of the rich and their wealth rose in Africa, Latin America, and the Middle East, Capgemini said.

The number of rich in Latin America rose by 4.7% as their wealth increased by 2.1%; Africa’s rich gained 4.3% new members who combined wealth increased by 1.6%, while the Middle East’s rich gained 2.8% new members as their wealth rose by 1.5%, Capgemini said.

Former New Hampshire Gov. Chris Sununu delivered a warning to Treasury Secretary Scott Bessent during a recent visit to Washington: Already-high airfares will surge if the war in Iran doesn’t end soon.

Sununu, a Republican who represents some of the biggest airlines as president of the industry group Airlines for America, has for weeks sounded the alarm to Trump administration officials about the economic fallout from high jet fuel prices. The war, Sununu has argued, must come to a close soon, or things will get worse.

Administration officials have gotten the message.

Privately, President Trump’s advisers are increasingly worried that Republicans will pay a political price for the rising fuel costs, according to people familiar with the matter. Many of those advisers are eager to end the war, hoping prices will begin to moderate before November’s midterm elections.

The fallout from the U.S.-Israeli attack in late February has slowed traffic through the Strait of Hormuz, a vital shipping lane, triggering a sharp increase in oil, gasoline and jet-fuel prices.

That means consumers are grappling with high costs ahead of the summer travel season, as they consider vacation plans.

Sixty-three per cent of Americans said they put a great deal or a good amount of blame on Trump for the increase in gas prices, according to a new poll conducted by NPR, PBS and Marist.

More than 8 in 10 Americans said struggles at the gas pump are putting strain on their finances.

Jet-fuel prices roughly doubled in a matter of weeks after the war began, and they have remained high. Airlines have said that will add billions of dollars of additional expenses this year, squeezing profit margins.

U.S. airlines spent more than $5 billion on fuel in March—up 30% from a year earlier, according to government data.

Carriers have been raising ticket prices, hoping to pass the cost along to consumers, and they are culling flights that will no longer make money at higher price levels.

In March, the price of a U.S. domestic round-trip economy ticket rose 21% from a year earlier to $570, according to Airlines Reporting Corp., which tracks travel-agency sales.

So far, airlines have said the higher fares haven’t deterred bookings and they are hoping to recoup more of the fuel-cost increases as the year goes on.

Earlier this week, Trump said the current price of oil is “a very small price to pay for getting rid of a nuclear weapon from people that are really mentally deranged.”

Secretary of State Marco Rubio told reporters that if Iran got a nuclear weapon, the country would have more leverage to keep the strait closed and “make our gas prices like $9 a gallon or $8 a gallon.”

Trump has taken steps in recent days to bring the war to an end. Late Tuesday, the president paused a plan to help guide trapped commercial ships out of the Strait of Hormuz, expressing optimism that a deal could be reached with Iran to end the conflict.

Crude oil prices fell below $100 a barrel on Wednesday, after reports that Iran and the U.S. are working with mediators on a one-page framework to restart negotiations aimed at ending the conflict and opening the strait.

Sununu said Trump administration officials are conscious of the economic fallout from the war: “They get it…and I think that’s why they’re trying to get through the war as fast as they can.”

But he cautioned that it could take months for prices to return to prewar levels.

“Ticket prices won’t go down immediately” after the strait is fully reopened, Sununu said. “You’re looking at elevated ticket prices through the summer and fall because it takes a while for the prices to go down.”

Since the initial U.S.-Israeli attack in late February, Sununu has met in Washington with National Economic Council Director Kevin Hassett, representatives from the Transportation Department and senior White House officials.

A White House official confirmed that Hassett and Sununu have discussed the effect of increased fuel prices on the airline industry. The official said the conversation touched on how the industry can mitigate the impact of high jet fuel prices on consumers.

“The president and his entire energy team anticipated these short-term disruptions to the global energy markets from Operation Epic Fury and had a plan prepared to mitigate these disruptions,” White House spokeswoman Taylor Rogers said, pointing to the administration’s decision to waive a century-old shipping law in a bid to lower the cost of moving oil.

Rogers said the administration is working with industry representatives to “address their concerns, explore potential actions, and inform the president’s policy decisions.”

A Treasury Department spokesman pointed to Bessent’s recent comments on Fox News that the U.S. economy remains strong despite price increases. The spokesman said Treasury officials have met with airline executives, who have reaffirmed strong ticket bookings.

“We’re cognizant that this short-term move up in prices is affecting the American people, but I am also confident, on the other side of this, prices will come down very quickly,” Bessent told Fox News on Monday.

The war has already contributed to one casualty in the industry: Spirit Airlines. Company representatives have said they were forced to close the airline because the sustained surge in jet-fuel prices derailed the company’s plan to emerge from chapter 11 bankruptcy.

The Trump administration and Spirit failed to come to an agreement for the company to receive a financial lifeline of as much as $500 million from the federal government.

Transportation Secretary Sean Duffy has argued that the Iran war wasn’t the cause of Spirit’s demise, pointing to the company’s past financial struggles, as well as the Biden administration’s decision to challenge a merger with JetBlue.

Other budget airlines have also turned to the federal government for help since the U.S.-Israeli attack. A group of budget airlines last month sought $2.5 billion in financial assistance to offset higher fuel costs, and they separately wrote to lawmakers asking for relief from certain ticket taxes.

The Rich Got a Bit Poorer Last Year

Administration officials have spoken to the airline industry, which has voiced concerns about the rising costs.