Wage disparities getting bigger in Germany | Business| Economy and finance news from a German perspective | DW | 18.03.2015
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Wage disparities getting bigger in Germany

Real income levels keep drifting apart in Europe's powerhouse, a fresh study has revealed. It said that the recent introduction of the minimum wage across industries would not suffice to reverse the trend.

Real German incomes, or gross wages adjusted for inflation, had not developed evenly in recent years across different wage sectors, a study by the Bertelsmann Foundation and the Munich-based Ifo economic research institute showed Wednesday.

It said that the incomes of those employees belonging to the group of the top 20-percent earners in the country had risen by 2.5 percent and increased more or less steadily since the mid-1990s, while the 5 percent of those getting the lowest wages had suffered a 2-percent dip in real incomes over the same period.

The authors of the study said one of the reasons for the increasing wage disparity had been a creeping decline of collective bargaining deals with binding wages.

No improvement in sight

Back in 1996, some 60 percent of firms across Germany paid their employees according to collective tariff commitments, the study noted. By 2013, it added, that figure was down to just 32 percent.

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Equal pay for equal jobs?

"We need to redouble our efforts to scale back wage disparities again without losing too many jobs," Bertelsmann Foundation chief Aart De Geus said in a statement, pointing out that the recent introduction of a minimum wage was not enough to rectify the current situation.

The survey noted that wage disparity in Germany was still below the average level logged in the 34 OECD countries. But it added that incomes in Germany had drifted apart at a much faster pace in the past two decades than those in the US and Britain.

hg/ng (dpa, epd, Reuters)

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