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Germans are poorer than Italians and French

Germans are poorer than Italians and the French, despite living in Europe’s biggest economy and bailing out struggling southern European countries.

Germans are poorer than Italians and French
Photo: DPA

The average wealth of German households is lower than both French and Italian ones, a report released on Wednesday by bank Credit Suisse said.

Despite the recession, average wealth per adult in Italy rose 5.6 percent to €178,615 between mid-2012 and mid-2013, according to the Global Wealth Report 2013, placing the country 13th in the world.

Wealth per adult was €154,900 in mid-2013 for the Eurozone, but there were significant differences between countries.

Credit Suisse estimated that household wealth in Austria, Germany, Ireland and the Netherlands was similar to the Eurozone level, but wealth is about 20 percent higher in Italy and Belgium. It is about 50 percent higher in France and Luxembourg.

Switzerland, which in 2011 became the first country where average wealth exceeded €370,000, topped the list.

However, Germany ranked highly for its number of millionaires coming in fourth place behind the USA, France and the UK. The number of millionaires in Germany is expected to grow by 46 percent by 2018. Meanwhile, total wealth grew by 7.7 percent in Europe, the report found.

At the global level, wealth per household increased by 4.9 percent to €38,188 per adult between mid-2012 and mid-2013. It also forecasts average household wealth will climb 39 percent over the next five years, with most of the wealthiest households being in emerging markets.

”Our research shows that global wealth has doubled since 2000, quite compelling given some of the economic challenges of the last decade,” said Michael O’Sullivan of Credit Suisse Research Institute.

“We expect this trend to continue in the foreseeable future, driven largely by Emerging Markets’ strong economic growth and rising population levels.”

READ MORE: French claim low German wages are unfair on them

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MONEY

Where in Germany do people have the highest disposable income?

An economic study has shown huge regional differences in income throughout Germany. So which parts of the country have the most to spend each month, and which are feeling the squeeze?

Where in Germany do people have the highest disposable income?

A study by the Economic and Social Sciences Institute (WSI) of the Hans-Böckler foundation reveals stark regional differences in disposable income in Germany. In some cases, households had as much as double the spending money of those in other parts of the country. 

Here’s where people have the most – and least – disposable income each month.

What is disposable income?

The WSI calculated disposable income as the sum of income from wealth and employment, minus social contributions, income taxes, property taxes and other direct benefits or taxes.

What’s left is the income which private households can either spend on consumer goods or save.

The study, which was based on the most recent available national accounts data for 2019, looked at the disposable income of all of the 401 counties, districts and cities across Germany.

Which regions have the highest and lowest disposable incomes?

The study found that the regions with the highest disposable incomes were in the southern states.

Heilbronn in Baden-Württemberg had the highest disposable income of all 401 German counties and independent cities – with an average per capita disposable income of €42,275. The district of Starnberg in Bayern followed in second place with €38,509.

READ ALSO: REVEALED: How much do employees really earn across Germany’s states?

By comparison, per capita incomes in the cities of Gelsenkirchen and Duisburg in North Rhine-Westphalia were less than half as high, at €17,015 and €17,741 respectively. These regions had the lowest disposable income in the country. 

The study also found that, more than thirty years since German reunification, the eastern regions continue to lag behind those in the west in terms of wages.

According to the WSI, the Potsdam-Mittelmark district is the only district in the former east where the disposable per capita income of €24,127 exceeds the national average of €23,706.

Do regional price differences balance things out?

The study also showed that regionally different price levels contribute to a certain levelling out of disposable incomes, as regions with high incomes also tend to have higher rents and other living costs.

“People then have more money in their wallets, but they cannot afford more to the same extent,” WSI scientist Toralf Pusch explained.

READ ALSO: EXPLAINED: When will Germany raise the minimum wage?

Therefore, incomes in the eastern states, adjusted for purchasing power, are generally somewhat higher than the per capita amounts would suggest.

That could explain why, even after price adjustment, the cities of Gelsenkirchen and Duisburg in western Germany continue to be at the very bottom of the list.

Saxon-Anhalt’s Halle an der Saale, on the other hand, which has an average disposable income of only €18,527, benefits from the lower prices in the east.

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