As EU Social Affairs ministers discuss social rights in the labour market, it is striking that, in the welfare state of Germany, your career still depends heavily on where you comes from. EURACTIV Germany reports.
Six generations is how long it takes in Germany until a low-income family has worked up to the average. In Scandinavian countries it takes around three generations.
A new study by the OECD paints a depressing picture: many Western European countries fare poorly on equal opportunities. Even in Germany, with its comparatively strong welfare state and free education system, the rule is that those born poor usually remain poor, whereas the rich remain rich.
When EU Social Affairs Ministers met in Luxembourg, they also discussed reconciling work and family life and equal access to the labour market. The European Pillar of Social Rights is meant to be advanced. The fact that opportunities in the labour market depend so heavily on origins, even in affluent Germany, is hardly cause for celebration.
A divided school system and mini-jobs reinforce social barriers
Of the German low earners – the 20% of the population with the lowest income – almost 60% never come out of their income class. At the same time, almost every second child of a manager becomes a manager later on.
At the upper end of the income scale, 74% of the highest earners never lose out. Although similar trends can be seen in other central European member states, some factors are inherent in the German system.
“I find the results alarming, but not surprising,” says Sabine Zimmermann, chairwoman of the Committee on family, senior citizens, women and youth, and labour market spokeswoman for the Left in the German Bundestag. Even children are blocked in Germany’s school system by being categorised into separate school forms at the age of ten, she says.
Later on in work, it does not get any easier: the German labour market is characterized by an increasing number of short-term contracts, mini-jobs or temporary work.
“Temporary work divides our society into first and second-class workers. Something like that should be abolished,” Zimmermann insists. Precarious working conditions, according to the OECD, make career advancement difficult, because those who do several jobs at the same time can hardly develop themselves professionally.
In Germany, 3.2 million people work in multiple jobs, the German government announced in October 2017.
Germany needs better redistribution of wealth
What then has to happen to overcome the hurdles?
“It is important that you drive in two directions: it takes short and long-term measures to loosen up social structures,” says Michael Förster, responsible for the social study. In concrete terms, this would mean a reduction in levies for low-paid workers, more incentives for full employment, and a reform of the inheritance tax to mitigate asset concentration.
In the long term, strong investment in early childhood education and all-day schools, a relaxation of the tripartite school system and the reduction of long-term unemployment is needed.
The German government’s coalition agreement commits to massive investment in families and education. Next week, the cabinet wants to finalise its family package worth €9.8 billion which includes increased child benefits.
From 2019 onward, a law on part-time work will regulate re-entry into the labour market. Germany’s impulses in family and labour policy are correct, says Förster. But reforms must bear one thing in mind:
“The most important thing about structural reforms is the distribution of wealth across income classes. If we cannot do that, social stagnation will get worse and then we will have a problem.”
Among other things, EU Social Affairs Ministers last week agreed on a common line for proposals on EU-wide minimum standards for parental leave and better coordination of welfare systems. Until the European Pillar of Social Rights opens up equal opportunities for advancement in the labour market, much more needs to be done.