Inequality rising in Germany: 40 percent earn less than 20 years ago
By
Marianne Arens
26 August 2017
Forty percent of employees in Germany earn less than they did 20 years ago. This statistic comes from a paper from the Federal Labour Ministry, which was released to the public this week.
According to the paper, the gross wages of the bottom 40 percent in 2015 were up to 7 percent lower than they were in 1995, while the wages of the top 60 percent rose by 10 percent. Wage disparities are thus growing rapidly.
The difference in household net income is even more striking. Households with low incomes suffered real-terms income declines of between 5 and 10 percent from 1991 to 2014. By contrast, households with high incomes saw income growth in real terms of more than 25 percent.
Wage inequality “increased significantly until 2010 and has remained at historically high levels since,” the paper stated. While “high-earners and owners of capital recorded significant income increases,” the incomes of low-wage earners have declined over the past 20 years.
Overall, the purchasing power of hourly wages remained stagnant from 1996 to 2007, even though labour productivity rose during the same period by 20 percent. Only corporations and capital owners benefited.
The growing disparity in wages is bound up with the growth of a massive low-wage sector. While in the mid-1990s, 16 percent of the working population earned less than two-thirds of the median hourly wage, this figure has hovered around 22 percent since 2006. This means that more than one in five workers labours for less than €10 per hour.
The data confirms what the Sozialistische Gleichheitspartei (SGP) is experiencing on a daily basis during its election campaign. Those affected repeatedly detail the terrible…