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MIL OSI Translation. Region: Germany / Deutschland –

Source: DGB – Bundesvorstand 01.10.2020klartext 33/202030 years of German unity: Closing the gap between East and West! Even 30 years after reunification, there are still economic differences between East and West Germany. In order to create equal living conditions in all parts of Germany, collective agreements are needed. Because where collective agreements apply, the adjustment of wages is almost complete.

DGB / Kathrin Biegner

There are still economic differences between East and West This week is the 30th anniversary of German reunification. Since then Germany has developed well economically and living conditions have noticeably adjusted, but 100 percent is still a long way off. There are structurally weaker and stronger regions in both the west and the east. Nevertheless, there are still large economic differences between East and West. Difficult framework conditions for East Germany Reunification 30 years ago took place under difficult framework conditions for East Germany. There was practically no more industrial base. Most companies were not competitive and many people lost their jobs as the economy transformed. Hundreds of thousands, mostly young people, migrated to the west. Developments that left profound traces in East Germany. East Germans earn an average of 15 percent less After initial successes with rising incomes and increasing economic output, the catching-up process in the east of the republic has stagnated for years. The economic output per capita in the new federal states is only 69 percent of the western level. The disposable income in the East is on average 15 percent lower than that of the West German employees (see figure). More property owners in West Germany The problem that many municipalities are heavily indebted that they can hardly finance their own infrastructure projects is even greater in the East than in the West. And there are also clear differences in the real estate sector. Because the proportion of property owners in the western German federal states is more than ten percent higher than in the east, as a current study by DIW shows. In western Germany almost twice as many households improve their income through rental income than in the east. Source: Federal Statistical Office; Working group VGR of the federal states; Standard report 2020.

Now politicians are called upon to create equal living conditions in all parts of the republic. Above all, more employees in the east must be able to benefit from collective agreements in the future. Where collective agreements are in place thanks to trade unions, the adjustment of wages is almost complete. In the east, however, only 45 percent of employees fall under the scope of collective bargaining agreements (in the west 56 percent). Only every fifth company in the east is still covered by collective bargaining agreements. Far too many employers go into the bushes and avoid decent pay. Public contracts only to companies bound by collective bargaining The state must therefore take countermeasures: It must be easier to declare collective agreements generally binding – i.e. binding for all companies in an industry. If public contracts are only awarded to companies that apply collective agreements, this also strengthens employees and collective agreements. In the new federal states in particular, these measures would contribute to higher incomes. Relief for over-indebted regions It is also clear that over-indebted regions need support so that living conditions can improve again and new good jobs are created. For this, among other things, an old debt repayment fund is needed, through which the federal and state governments can reduce the debt burdens in order to give them air to breathe.

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EDITOR’S NOTE: This article is a translation. Apologies should the grammar and / or sentence structure not be perfect.

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