Category / Corona Pandemic / Income and assets
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How has the pandemic affected household income?
The income gap between high and low-income households has narrowed over the course of the pandemic. But this is not because things have improved for people on the lower end of the income distribution, as one would have hoped. Instead it is because self-employed people, who are usually among the better-off, have suffered in the wake of measures to combat the virus. The resulting narrowing of the income gap is therefore bad news rather than good.
“If the pandemic drags on well into this year, and if measures to contain it are tightened again, this could bring about rising bankruptcy and unemployment,” says SOEP expert Markus Grabka, who conducted the study.
His analyses show that monthly net household incomes of the self-employed fell by an average of 16 percent, or 460 euros, during the second lockdown compared with 2019. In contrast, salaried employees and civil servants saw a 5 percent increase in household income in nominal terms. In the remaining households, there was no change in income on average.
Further information
DIW Berlin: Corona pandemic reduces income inequality
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How rich are you?
How rich are you compared to others? With an interactive calculator based on the study “Living in Germany,” you can find out where you lie in the income distribution in Germany, and how much of the population is better or worse off than you. The calculator takes into account income, assets, but also your housing situation. The interactive calculator on ZEIT online was developed by a research team led by Bremen sociologist Olaf Groh-Samberg.
