Low wage growth in Germany?

Abstract

"The German labour market follows a fascinating employment trend since the year 2005. In contrast, wage growth remained weak until 2010 and although wage dynamics have picked up by now, they remain clearly subdued when compared to the vibrant development of employment and vacancies. Various explanations such as weak productivity development and the rise of service jobs are given for this phenomenon. In the same context, one often finds the strong migration to Germany. The argument is a classical one: migrants increase labour supply which leads to higher wage competition. We argue that such a mechanism is unlikely to have played a relevant role for German wages in the recent years." (Author's abstract, IAB-Doku) ((en))

Cite article

Klinger, S. & Weber, E. (2018): Low wage growth in Germany? Don't blame the migrants! In: IAB-Forum No. 23.03.2018, o. Sz.