IDEAS home Printed from https://ideas.repec.org/a/diw/diwdwr/dwr8-9-1.html
   My bibliography  Save this article

Inequality in Germany: Decrease in Gap for Gross Hourly Wages since 2014, but Monthly and Annual Wages Remain on Plateau

Author

Listed:
  • Markus M. Grabka
  • Carsten Schröder

Abstract

Despite the booming German labor market, wage inequality is still a relevant issue. In the present study, the authors report on the changes in wages and their distribution between 1992 and 2016. In addition to real contractual gross hourly wages, we closely examined gross monthly and annual wages. Based on Socio-Economic Panel (SOEP) data, the results show that wage inequality rose significantly between 1992 and 2005, in particular with respect to monthly and annual wages. Since then inequality in monthly and annual wages has plateaued at its 2005 level. Inequality in hourly wages has decreased only since 2014, and between 2013 and 2016, average real gross hourly wages rose by five percent after a longer phase of stagnation. For the lowest ten percent of the population, they rose by 13 percent—a rate related to the implementation of sector-specific wages and the statutory minimum wage. However, these minimum wages obviously did not affect monthly and annual wages as anticipated.

Suggested Citation

  • Markus M. Grabka & Carsten Schröder, 2018. "Inequality in Germany: Decrease in Gap for Gross Hourly Wages since 2014, but Monthly and Annual Wages Remain on Plateau," DIW Weekly Report, DIW Berlin, German Institute for Economic Research, vol. 8(9), pages 83-92.
    • Handle: RePEc:diw:diwdwr:dwr8-9-1
    as

    Download full text from publisher

    File URL: https://www.diw.de/documents/publikationen/73/diw_01.c.579137.de/dwr-18-09-1.pdf
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Stüber, Heiko & Grabka, Markus M. & Schnitzlein, Daniel D., 2023. "A tale of two data sets: comparing German administrative and survey data using wage inequality as an example," Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 57, pages 1-8.
    2. Beckmannshagen, Mattis & Schröder, Carsten, 2022. "Earnings inequality and working hours mismatch," Labour Economics, Elsevier, vol. 76(C).
    3. Charlotte Bartels & Carsten Schroeder, 2020. "Income, consumption and wealth inequality in Germany: Three concepts, three stories?," Basic Papers 2, Forum New Economy.

    More about this item

    Keywords

    Wage inequality; monthly earnings; annual earnings; SOEP;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:diw:diwdwr:dwr8-9-1. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Bibliothek (email available below). General contact details of provider: https://edirc.repec.org/data/diwbede.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.