Is the German Middle Class Crumbling? Risks and Opportunities
Thriving middle classes are the backbone of democratic societies and strong economies, but in many countries, they face mounting pressure as their economic strength is eroding relative to higher-income households. Real wages and incomes for most middle-class households have grown only very slowly, a...
| Main Author: | |
|---|---|
| Corporate Author: | |
| Format: | eBook |
| Language: | Inglés |
| Published: |
Paris :
Organization for Economic Cooperation & Development
2022.
|
| Subjects: | |
| See on Biblioteca Universitat Ramon Llull: | https://discovery.url.edu/permalink/34CSUC_URL/1im36ta/alma991009704897306719 |
Table of Contents:
- Intro
- Foreword
- Executive summary
- The German middle class shrank in the late 1990s and early 2000s, and has not recovered since
- Particularly the young generation and people without tertiary education find it harder to secure a place in the German middle class
- Germany's labour market has polarised, but middle-income workers have been coping relatively well so far with the labour market transformation
- Short-term income mobility in Germany has become less favourable for households in the lower part of the income distribution
- Policy options for a stronger German middle class
- 1 Assessment and policy options
- 1.1. Trends in the size and composition of Germany's middle class
- 1.1.1. After one-and-a-half decades of real income stagnation, middle-income households in Germany experienced healthy income growth from 2015
- 1.1.2. The German middle-income group has shrunk in the late-1990s and early-2000s, mostly at the lower end, and has not recovered since
- 1.1.3. The middle-income group pays more in income taxes than it receives in social benefits, but most redistribution takes place within the middle-income group
- 1.1.4. The German middle-income group has been changing its socio-demographic composition
- 1.2. The labour market trends of middle-income workers in Germany
- 1.2.1. Most middle-income workers are employed in middle- and high-skilled occupations, and the occupational distribution has become more polarised
- 1.2.2. Middle-income workers have shifted out of manufacturing towards public services, which together account for more than half of all middle-income jobs
- 1.2.3. Non-standard work has become more frequent among middle-income workers, but it remains much less widespread than for workers in other income groups.
- 1.2.4. A sizeable minority of middle-income full-time workers are in low-paid jobs, but low-paid employment has risen only for low-income workers
- 1.2.5. One-in-six middle-income workers in Germany work in jobs facing high risk of automation
- 1.2.6. Forecasts show positive employment growth for middle-income occupations, but also further occupational polarisation
- 1.2.7. Short-time work prevented larger employment losses for middle-income workers in the initial phase of the COVID-19 crisis
- 1.3. Income mobility in the German Middle Class
- 1.3.1. Incomes in Germany are highly persistent, more so than they were in the late 1990s
- 1.3.2. People in the lower (and mid) middle have low chances of rising to the top, and a high and rising risk of slipping out towards the bottom
- 1.3.3. Meanwhile, upward mobility into the middle-income group has declined
- 1.3.4. Income mobility patterns have become less favourable in particular for more disadvantaged labour market groups
- 1.4. Policy options for a stronger German middle class
- 1.4.1. Building pathways into the middle class for the young generation
- 1.4.2. Enabling and encouraging middle-class workers to upskill and reskill throughout their careers
- 1.4.3. Improving the working conditions and pay of care professionals
- 1.4.4. Creating middle-class jobs by renewing Germany's infrastructure
- 1.4.5. Reducing the labour tax burden for middle-class workers
- 1.4.6. Enabling and incentivising women to expand labour force participation
- References
- Notes
- 2 The German middle class - a statistical profiling
- 2.1. The economic, political and social importance of a thriving middle class
- 2.2. Who counts as "middle class" in Germany?
- 2.2.1. The middle class is a complex social construct
- 2.2.2. An income-based definition of the middle class.
- 2.3. Trends in middle-class incomes in Germany
- 2.3.1. German middle-income households have experienced very modest income growth since the mid-1990s, and income disparities in Germany have widened
- 2.3.2. The German middle-income group has shrunk in the late-1990s and early-2000s, mostly at the lower end, and has not recovered since
- 2.3.3. Germany experienced a faster decline in the middle-income group than most other OECD countries
- 2.3.4. The German middle-income group accounts for a declining share of total household income
- 2.3.5. The middle-income group pays more in income taxes than it receives in social benefits, but most redistribution takes place within the middle-income group
- 2.4. Changes in the composition of the middle-income group in Germany
- 2.4.1. The German middle-income group has aged more quickly than the general population, and young people find it difficult to secure their place
- 2.4.2. Working couples, and particularly one-and-a-half earner households, have been much less affected by the decline in the middle-income group
- 2.4.3. People with upper- and post-secondary education still make up the bulk of the middle-income group
- 2.4.4. Immigrants are much less likely than in the mid-1990s to make it into the middle-income group in Germany
- 2.4.5. The size of the middle-income group varies substantially between regions in Germany, and it has declined much more strongly in cities than in rural areas
- 2.5. Conclusions
- References
- Annex 2.A. Income trends in selected OECD countries
- Notes
- 3 The German middle class in a changing world of work
- 3.1. Introduction
- 3.2. Middle-class jobs in Germany: Trends in sectoral and occupational composition
- 3.2.1. Most middle-income workers are in middle- and high-skilled occupations
- 3.2.2. The occupational distribution has become more polarised.
- 3.2.3. Female middle-income workers have been moving up the occupational ladder
- 3.2.4. Middle-income workers have shifted out of manufacturing towards public services, which together account for more than half of all middle-income jobs
- 3.3. Middle-income workers in non-standard and low-paid work
- 3.3.1. Few middle-income workers are employed on temporary contracts
- 3.3.2. Part-time work is widespread only among female middle-income workers
- 3.3.3. Few middle-income workers in Germany are self-employed
- 3.3.4. A sizeable minority of full-time middle-income workers are in low-paid jobs, but low-paid employment has risen only for low-income workers
- 3.4. Employment prospects of middle-class workers - the risk of automation and changes in skill demand
- 3.4.1. A substantial share of middle-income workers are in occupations that are highly automatable
- 3.4.2. Growth forecasts for middle-income jobs are positive but point towards further occupational polarisation
- 3.5. Employment outcomes and incomes of middle-class workers during the COVID-19 crisis
- 3.5.1. Short-time work prevented larger employment losses among middle-income workers during the initial phase of the COVID-19 crisis
- 3.5.2. Income losses during the COVID-19 crisis have so far been largest for workers high-income households
- 3.6. Conclusions
- Annex 3.A. Further details on occupational categories and sectors
- References
- Notes
- 4 A spotlight on social mobility in the German middle class
- 4.1. Income mobility in the German middle class: risks and opportunities
- 4.1.1. Incomes in Germany are highly persistent, more so than they were in the late 1990s
- 4.1.2. People in the lower (and mid) middle have low chances of rising to the top, and face a high and rising risk of slipping out towards the bottom.
- 4.1.3. An increasing share of people who drop out of the lower middle fall into poverty
- 4.1.4. Meanwhile, upward mobility into the middle-income group has declined
- 4.1.5. Income mobility patterns have become less favourable in particular for more disadvantaged labour market groups
- 4.2. Conclusion
- References
- Annex 4.A. Additional results on downward mobility into poverty
- Notes
- 5 Policy options for a stronger middle class in Germany
- 5.1. Introduction
- 5.2. Strengthening the employability of middle-class workers
- 5.2.1. Enabling and encouraging middle-class workers to upskill and reskill throughout their careers
- Participation rates in adult education and training in Germany are lower than in peer countries
- Shortage of time is the dominant factor preventing workers from participating in education or training in Germany
- Middle-skilled workers often do not see a need for training
- Career guidance can play an important role in promoting training participation, but the German career guidance landscape is difficult to navigate
- Austria successfully increased participation in adult learning by introducing a national paid training leave
- Helping to identify learning needs, linking workers with appropriate education opportunities, and building a positive adult learning culture could bring substantial benefits
- Structural transformation changes skill demand and is likely to amplify regional labour market imbalances, but Germany lacks forward-looking skills management
- 5.2.2. Building pathways into the middle class for the young generation
- The COVID-19 crisis led to drop in the availability of apprenticeship places - and in the number of applicants
- A vocational training guarantee could ensure that every young person gets the chance to obtain a qualification
- 5.3. Creating good-quality, future-oriented jobs.
- 5.3.1. Creating middle-class jobs by investing in public infrastructure.
