Employees in Germany see biggest drop in wages in more than a decade

The average German worker experienced a one percent drop in real earnings in the pandemic year of 2020, the most significant drop since records began in 2007.

Employees in Germany see biggest drop in wages in more than a decade
Photo: DPA

Numbers published by the Federal Statistics agency showed that huge disruption to working life caused by the pandemic and the resultant lockdowns led to a drop in pre-tax earnings (nominal earnings) of 0.6 percent last year.

“Unlike during the financial and economic crises of 2008/2009, workers in Germany had to accept a drop in nominal earnings in 2020,” the statistics agency commented.

At the same time prices went up by an average of 0.5 percent over the year, leading the agency to conclude that real wages sunk by one percent.

Real wages have only twice dropped over the past 13 years. Following the financial crisis there was a slight decrease of 0.1 percent in real earnings in 2009; and in 2013 a similar decrease of 0.1 percent was recorded in the midst of the Greek debt crisis.

The drop in wages interrupts years of strong wage growth, with six years of consecutive growth of over one percent between 2014 and 2019 while the German economy as a whole was booming.

A central cause of the wage reduction was the massive Kurzarbeit (furlough) programme that the government introduced during the first wave of the pandemic. At the high point in April some 6 million people were on the Kurzarbeit, meaning that they were either not working or were placed on reduced hours.

The state paid a percentage of people’s wages while they were on Kurzarbeit. This money was not included in the statistics agency’s calculations, but is likely to have had a considerable impact on the overall financial picture in German households.

READ ALSO: What you need to know about Germany’s ‘Kurzarbeit’ job support scheme

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Munich sees sharp rise in Covid cases after Oktoberfest

Since the start of Germany’s Oktoberfest, the incidence of Covid infections in Munich has risen sharply. Though a connection with the festival can’t yet be proven, it seems likely.

Munich sees sharp rise in Covid cases after Oktoberfest

Two weeks after the start of Oktoberfest, the Covid numbers in Munich have more than tripled.

On Sunday, the Robert Koch Institute (RKI) reported an incidence of 768.7 for the city of Munich, though updated figures for the end of the festival are not expected until later in the week. Usually, on weekends and public holidays, there is a delay in reports.

In the entire state of Bavaria, the incidence value on Sunday was 692.5.

According to Munich’s public health officer, Beatrix Zurek, bed occupancy in Munich hospitals has also increased. Two weeks ago, 200 beds in Munich were occupied by Covid patients, whereas there are now around 350.

Though a relationship between the sharp rise in infections with Oktoberfest, which ended on Monday, can’t be proven at the moment, it seems very likely, according to experts. A significant increase in Covid incidences has also been shown at other public festivals – about one and a half weeks after the start. 

READ ALSO: Germany’s famed Oktoberfest opens after two-year pandemic hiatus

After a two-year break due to the pandemic, around 5.7 million visitors came to this year’s Wiesn according to the festival management – around 600,000 fewer than at the last Oktoberfest before the pandemic in 2019, when there were 6.3 million.

Federal Health Minister Karl Lauterbach (SPD) took to Twitter to comment on the rise in incidence in Munich during the Oktoberfest. “This would not have been necessary if self-tests had been taken before admission,” he said.

“Compared to the price of a measure of beer, €2-3 (for tests) wouldn’t have mattered,” he said.

Even before the start of the Wiesn, he had spoken out in favour of people taking voluntary self-tests. Lauterbach stressed that now is the time for special measures against Covid.

“The development shows what will happen if the states wait too long with the mask obligation in indoor areas,” he added.

READ ALSO: KEY POINTS: Germany’s new Covid-19 rules from October

In neighbouring counties, where many Oktoberfest visitors came from, the number of Covid cases has also risen noticeably.  Beatrix Zurek said that it is unclear, however, how much of a role Oktoberfest played in these figures, as people are currently much more active socially overall, with concerts and other events also taking place throughout the state.

Christoph Spinner, an infections specialist at Munich’s Klinikum, has urged people not to be alarmed by the rising numbers.

“We had expected rising incidences here. We knew that there could be a doubling, tripling, even quadrupling,” he said.

He said that this is no cause for concern, as many people have been vaccinated or have also recovered from previous Covid infections, so any new infections are therefore usually mild.

The virologist advises people over 60 or with pre-existing conditions to get a second booster vaccination, but otherwise said people shouldn’t be alarmed by the rising incidences.