Gap between rich and poor widest in Germany
Germany is seen as a global economic powerhouse that well surpasses its neighbours in the EU. But take a look inside and we can see wealth is distributed unequally among its people.
A report by the German Institute for Economic Research and the centre-left Hans-Böckler Foundation revealed the country has the greatest rate of unequal wealth distribution in the EU. Using the Gini co-efficient scale of 0 to 1 where ‘0’ means no inequality and ‘1’ means maximum inequality, Germany has consistently been rated 0.78.
Researcher Markus Grabka commented that ‘Overall not much has changed in wealth distribution — inequality remains high.’ This inequality in wealth can be seen between east and west Germany, men and women, managers and employees and families with and without children.
Here’s what they found out:
- The average wealth of West Germany residents is twice as much as East residents at €94,000 compared to €41,000
- The average man is wealthier than the average woman by €27,000
- The average wealth of a self-employed businessman is €952,000 compared to an unemployed person who has €18,000
- The average manager was four times wealthier than the skilled employee at €210,000 compared to €45,000
- The average childless couple has €108,000 per person while couples one child have €62,500 per person, couples with two children have €50,500 and couples with three have €44,000
Researchers revealed that the true extent of wealth is not clear yet as the wealthiest are not well represented in statistics. The richest 1% has an average personal wealth of at least €817,000. Those in the top 10% own at least €217,000. If private wealth was distributed equally among all Germans, each would have €83,000.
The study also found out that 28% of German adults have no assets or are in debt. This is despite the continued rise in the value of private assets from figures five years ago.
Researchers suggest that to solve unequal wealth distribution more efficient taxation must be introduced on earnings.