Saxony: East Germans get more wages

Dresden. In the year that is coming to an end, employees in Germany have significantly more money in their pockets. After deducting inflation of around 2.2 percent, there remains a real wage increase of 3.2 percent compared to 2023. The inflation compensation bonus made an important contribution, according to the Economic and Social Sciences Institute (WSI) of the Hans Böckler Foundation.

In order to cushion the economic consequences of the war in Ukraine, the federal government gave companies the opportunity in autumn 2022 to pay their employees up to 3,000 euros in addition to their wages, tax-free and duty-free. This enabled higher net wages and lower labor costs for employers. Voluntary payment is only possible until New Year’s Eve – even as a mini-jobber, because it is not counted towards the monthly earnings cap of 520 euros.

Almost 26 million employees received a total of over 52 billion euros as inflation compensation. This is proven by a study by the Institute for Macroeconomics and Business Cycle Research (IMK) of the Böckler Foundation. The aim of the bonus was to stabilize purchasing power in the face of record inflation without setting off a price-wage spiral. As co-author Jan Behringer told this newspaper, the fiscal relief from the premium corresponds to around one percent of gross domestic product, the sum of all goods and services produced. Unit labor costs were reduced by around 1.5 percent. 9,600 people were surveyed for the representative study. On average, they were paid 1,953 euros.

Payment in the East is sometimes higher than in the West