Analysis: Low wages in Mecklenburg-Western Pomerania and the effects on economic policy

Analysis: Low wages in Mecklenburg-Western Pomerania and the effects on economic policy

According to a report by www.n-tv.de, opposition parties in Mecklenburg-Western Pomerania have reacted to the persistent income gap between East and West. The Greens are calling for an accelerated expansion of green electricity production in order to create incentives for industrial companies to settle there. The FDP criticizes the failed economic policy and calls for investments in education, infrastructure and digitalization. The average annual gross income of employees in Mecklenburg-Western Pomerania was around 39,600 euros in 2023, almost 10,000 euros or 20 percent less than the national average.

The low industrial density and the low collective bargaining coverage of the often small companies in the northeast are seen as key reasons for the salary gap. Employees in Hesse achieved the highest annual income with an average of just under 54,000 euros.

This income disparity can have far-reaching effects on the regional market and financial industry. Lower worker incomes could reduce consumption and demand in the region, which in turn could affect the local economy. In addition, lower incomes could lead to a brain drain as well-trained specialists could migrate to regions with higher earning potential.

In order to counteract this development, it is important to create incentives for companies to offer jobs with higher income opportunities. Targeted support for industrial companies as well as investments in education and infrastructure could help reduce the income gap and strengthen the economy in Mecklenburg-Western Pomerania.