East-West Earnings Gap
June 12, 2007
Seventeen years after reunification, wages and salaries in eastern Germany are still drastically lower than in the west, according to a recent study of 70,000 workers by the union-affiliated Hans Böckler Foundation.
The average east-west wage difference is 21 percent, although in certain sectors, westerners earned as much as 41 percent more than their eastern-German counterparts, the online study showed.
"It is a big problem that so many years after reunification, such earnings discrepancies still exist," Reinhard Bispinck of the Hans Böckler Foundation told reporters after announcing the results. "Clearly we haven't managed to get the economies of both parts of the country on equal footing."
Gap cuts across sectors
The wage gap cuts across trades: A cook in western Germany takes home an average 1,311 euros per month ($1,750), compared with 985 euros in the east. A web designer in the west takes home an average 41 percent more than their eastern counterparts: 2,300 euros compared to 1,360 euros.
Eastern German auto mechanics, data-entry workers, accountants, secretaries, bookkeepers, machinists and retail buyers all were paid about a third of what they would earn in the western states. And there was a 20 percent discrepancy between geriatric nurses, civil engineers, teachers, metal workers, and cooks.
How to account for the chasm between eastern and western pay scales? The main problem lies in the east's stagnant economy, Bispinck said, noting eastern unemployment is nearly double that in the west.
Fewer wage agreements
Moreover, the number of workers who are paid according to collective-bargaining agreements or union scales is much lower in the east, Bispinck pointed out. "In the 'new' German states just 50 percent of workers are paid at union wages, compared with two-thirds in the west. That gives eastern-German employers a much greater chance to pay less," Bispinck said.
"If the economic upswing continues for a while, then there is a chance for the east to catch up," he added, although he admitted there had been no sign of this happening so far.