February 07, 2020
Wage Development in Bavaria: low wage sector as entrance and spingboard
The low wage sector is often a topic of controversial public debate. Some see it as a precarious part of the labor market that needs to be brought under control through various machanisms, for instance, regulating atypical employment relationships. The Study „Niedriglohn und Lohnmobilität in Bayern“ commissioned by the vbw – Vereinigung der Bayerischen Wirtschaft e. V. shows that indeed, the low wage sector, espcially in the state of Bavaria, is a viable entry-level option for people with very little access to the labor market.
The low wage sector in Bavaria is relatively small, career opportunities are better
The number of people employed in the low wage sector in Bavaria is especially low according to the main findings of the vbw study. While the percentage of people working in the low wage sector in Germany is 21.2, this figure is about 19.0 in the state of Bavaria. In metropolitan areas, it is 13 percent. „In addition, the opportunities for financial and social upward mobility for low wage earners are especially good in Bavaria“, according to Bertram Brossardt, the CEO of the vbw.
About 27 percent of low wage workers in the free state of Bavaria earn regular wages within a year and thus achiving wage increases of over 46 percent.
The vbw does not support further regulation of the low wage sector, while „ for the long term unemployed and those with low skills, the low wage sector is an important entry way to the laobr market und employement relationship“.
Qualifications is a deciding factor for advancement opportunities
The opportunities to get a job and earn normal wages are very good in Bavaria, if an employee has a college degree or has completed an apprentice program or work in a job that requires the completion of an apprenticeship program. This is due to the large concentration of the manufactuing sector in Bavaria. A job in manufaturing in Bavaria is seldom synonimous with a job in low wage sector when compared to all other German states (there is a -15 percentage point difference). Unskilled and least qualified workers on the average stay longer in low wage sectors. The project „Chance Teilqualifizierung“ founded by vbw and the Bildungswerk der Bayerisschen focuses on providing further training for employees. Since 2007, more than 15,400 employees have completed continuing education training through the program. About 1200 companies have already taken part in the program. This improves the opportunities for further advancement.