Manual Class Counts: Education, Inequality, and the Shrinking Middle Class

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In recent years, there have been numerous studies showing a rise in the inequality of incomes, a lowering of real wages for most employees, the impoverishment of an ever-growing section of the population—17 percent of Germans now count as poor—as well as an enormous enrichme nt at the upper end of society.

The middle layer as defined purely economically by the DIW researchers comprises skilled workers, mid-level white-collar employees and most university graduates. The former white-collar employees at Deutsche Telekom, the railways, and the post office and in the auto, engineering, steel, mining and chemical industries form the core social group defined as middle class in the DIW study. It is among such layers that there have been the greatest changes in recent years.

Industrial jobs have been destroyed by the thousands or have been converted into contract labour. Many of the former skilled workers from large corporations must now work as cheap wage labour. Many companies paid fewer taxes in despite having higher profits than the previous year. Deutsche Telekom paid out even more than it recorded in profit! Not to mention the fact that top executives have seen their pay packets rise by around 15 percent.

The decline of the middle class has set alarm bells ringing in political circles. In a footnote, the DIW experts report that the shrinking of this middle layer could already be observed in the s in the US and Britain. Thus within a few years, Germany has undergone a development that took decades in the US and Britain, where the incomes of t he middle layers have also declined.

This has far-reaching political implications.

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It is the middle class, which has characterised postwar Germany like no other social group, that is now suffering acutely. The entire social fabric is falling apart. The daily experience of millions is that one of the core ideological tenets of postwar Germany no longer applies—that a growing economy also provides for increasing wages and salaries.

Today, the opposite is the case. But how are people to secure their incomes and that of their family? Through additional work? Actual work times have already risen in recent years, without having any positive influence on incomes. Also, the growth in the number of women in the job market has not led to an improvement in family incomes.

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