Most Revd Justin Welby said the problem had left London feeling like a "different country" to the rest of the UK.
He told ITV News: "There remains a significant level of inequality, which is widening. And certainly having moved down to London only two years ago, having lived away from London for 25 years, you felt as though you'd moved into a slightly different country."
The comments are the latest in a serious of criticisms by Church leaders against the government.
Asked about economic growth in Britain, the former oil executive said it was "very good", but added: "The point is, though, will the economy grow equally across the whole country?"
"The big challenge if we're going to rebalance, is that areas outside the South East get the same level of investment, and growth, and strength and increase in average incomes as the South East does," he added.
When asked if the government could cut poverty and public spending at the same time Archbishop Justin said: "I'm not a good enough economist to answer that and it depends how much you cut government spending."
He added that he was not saying the welfare system didn't need reformed but said "it's a question of priorities".
But when challenged on proposals to cut state spending back to levels seen in the 1930s he said: "That's a party political question, I'm not going to answer it."
During the interview he also urged companies to pay the living wage to their staff, currently £7.85 an hour or £9.15 in the capital.
"Increasing numbers do, and if we're really honest, when we looked within the Church we found bits of our own operations that were not paying it, and we've changed that, and we're a charity and we can do it.
"And so yes, it can be done and it should be done. The living wage is what it says, it's not two holidays in Bermuda every year."