German real wage growth slowed by inflation: study

BERLIN, Feb. 8 (Xinhua) -- The purchasing power of German employees has only increased slightly despite rising wages in 2017 due to inflation, according to official figures published on Thursday by the Federal Statistical Office.

Although nominal wages rose by 2.5 percent on average in 2017, a simultaneous increase in consumer prices of 1.8 percent reduced the resulting real gain experienced by employees to 0.8 percent. Annual real wages grew for the fourth consecutive time in Germany, but at the slowest pace measured since 2013.

According to the Wiesbaden-based government statisticians, real wages grew by an annual average of 1.0 percent between 2007 and 2017.

The Federal Statistical Office noted in a statement that the development was typical for a sustained economic expansion and highlighted that, all things held equal, growing wages and low unemployment lead to increases in private consumption and hence wider economic growth.

The European Central Bank (ECB) and European Commission have both advocated for stronger real wage growth as a means to raise living standards and push inflation closer to the official annual Eurozonetarget of just below, but under two percent.

Having recorded a real wage growth of 0.8 percent, Germany is currently above the estimated EU average of 0.4 percent in 2017. Italy, Spain, Belgium, Finland, Cyprus, and the departing United Kingdom in particular, were negative outliers last year, each witnessing falling real wages.

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German real wage growth slowed by inflation: study

Source: Xinhua2018-02-09 04:36:19

BERLIN, Feb. 8 (Xinhua) -- The purchasing power of German employees has only increased slightly despite rising wages in 2017 due to inflation, according to official figures published on Thursday by the Federal Statistical Office.

Although nominal wages rose by 2.5 percent on average in 2017, a simultaneous increase in consumer prices of 1.8 percent reduced the resulting real gain experienced by employees to 0.8 percent. Annual real wages grew for the fourth consecutive time in Germany, but at the slowest pace measured since 2013.

According to the Wiesbaden-based government statisticians, real wages grew by an annual average of 1.0 percent between 2007 and 2017.

The Federal Statistical Office noted in a statement that the development was typical for a sustained economic expansion and highlighted that, all things held equal, growing wages and low unemployment lead to increases in private consumption and hence wider economic growth.

The European Central Bank (ECB) and European Commission have both advocated for stronger real wage growth as a means to raise living standards and push inflation closer to the official annual Eurozonetarget of just below, but under two percent.

Having recorded a real wage growth of 0.8 percent, Germany is currently above the estimated EU average of 0.4 percent in 2017. Italy, Spain, Belgium, Finland, Cyprus, and the departing United Kingdom in particular, were negative outliers last year, each witnessing falling real wages.

[ Editor: meng ]
 

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