Buying power, inflation and others

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I remember a friend of mine got a job as SW Developer in München in 2001,and was getting ca. 90-95K DM. It was after the dot.com bust.

Another one I know got a job in München last year (after a German Semi went belly-up),at 46K EUR. Both had similar background/experiences...market were similarly tight in both cases.

I personally think 90k DM had much more buying power than 46k Eur...even if they were equal,average starting salaries haven't hiked much last 10 years (at least in Germany),rather have tanked a little. Many companies now try to stay out of tarif scales, meaning less pay.

At the same time, the 20 DM Schönes Wochenende ticket became 37 Eur... bahn prices get 3-5% higher every year...As does many other prices like gas,house-rent,electricity etc etc. The only thing that stayed stable is the prices at Super markets...thanks to Herr. Aldi:)

What's your take? Did we (living in Germany) get richer or poorer last 10 years?

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The only thing that stayed stable is the prices at Super markets...thanks to Herr. Aldi:)

 

Ummm, you did notice that part where stuff in supermarkets now costs the same in Euro as it did in DM fifteen years ago?

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For me - definitely poorer. Costs have more than doubled, particularly eating and drinking out while income is nowhere near double.

 

I felt quite well of when I came here - now I have to be quite careful.

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What's your take? Did we (living in Germany) get richer or poorer last 10 years?

I could be a spoilsport and quote the actual numbers available to everyone from the Statistische Bundesamt. I'm too lazy, though :P

 

Basically, yes, we got poorer in terms of buying power. Most of us did. Anecdotal proof: What I made per hour working as a lowly secretary in the late eighties (I was VERY young and VERY inexperienced, also not keen on the job and did it only to finance my travel bug) would turn heads now when converted into euros. I guess it's the same for salaries in many other fields for older and experienced employees. There's always exceptions, of course. But overall, buying power went down, ALDI prices notwithstanding, there's more to life than ALDI. Especially if you want to eat and live well...

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A lot of Germans I know say that. That there was price inflation on coversion and it is really 1-1 and not 1.95 to 1. Same price in Eur as in DM. The Germans do the mental arithmetic routinely of course in a way we do not. They cite an example like a sandwich that costs 3 Eur would be almost 6 DM etc which they would consider super-expensive (but it was only 3 DM a decade ago).

 

What is as interesting is relative price changes. That it tends to cost less to fly than go by rail. That you can get so much stuff that we used to spend decent income on for free now - newspapers, music, books etc - or very low cost (electronic devices etc). I mentioned on a thread here that I've noticed just how much stuff I get for free now. I just get it (in stores, from clients / associates, offered on the street etc). I can write a list of new freebies each week (and in a way this links to a point on prosperity below - as you get better off, life gets cheaper).

 

I think it is widely known that "real" German wages have gone down. The toss is regularly argued over whether that is good / fair / anti-competitive etc. A lot of people seem to input far more hours for their money too of course. Essential stuff requiring serious labour input goes up in price because those workers want more money, just like we do. Can't expect average salaries of 42k Eur (or even more) but for teachers, medical staff etc to be on a pittance.

 

But more of us have money now and that's what puts the prices of scarce stuff - like housing (at least in the places people want to live) - up.

 

By the way, your mate? In 2001, average pay was 5 407 p.m. / 65k p.a. so 90k DM was +40%. Your mate's 46k is +8% more than average and -15% on the Bavarian average (52k). So not sure you are comparing like with like really.

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Same price in Eur as in DM. The Germans do the mental arithmetic routinely of course in a way we do not. They cite an example like a sandwich that costs 3 Eur would be almost 6 DM etc which they would consider super-expensive (but it was only 3 DM a decade ago).

 

I do it too. I've been here a long time and paying 7DM (€3,50) for a beer, let alone the Wiesn prices, is to me a lot of money. The downturn in the economy and competition from cheap labour countries has resulted in me earning approximately the same as I was earning 10 years ago, which makes me a lot worse off than 10 years ago. I can remember telling a German friend of mine that she should take out any long term loans that she thought she might need before the onset of the Euro as replacing a currency with one that was actually worth twice as much as the DM, would cause prices to rise, just like it did in the 1970's in Britain when we went decimal and suddenly when something went up in price by a penny it was actually 2,4 pence. The same has happened here, prices go up by a cent but that is actually 2 pfennings. She didn't believe me but I have been proven right.

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Speaking of inflation, today in huge letters on BILD, above the fold as they say, Teuer Schock inflation at 7,3%, historical high, if I understood the headline correctly. Curious has anyone heard what the  unions are going to ask for pay rises this year. I'm assuming they're going to be north of 5%. After 30 years of sub 2% that is absolutely insane!

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On 10/20/2010, 9:58:34, Allershausen said:

 

I do it too. I've been here a long time and paying 7DM (€3,50) for a beer, let alone the Wiesn prices, is to me a lot of money. The downturn in the economy and competition from cheap labour countries has resulted in me earning approximately the same as I was earning 10 years ago, which makes me a lot worse off than 10 years ago. I can remember telling a German friend of mine that she should take out any long term loans that she thought she might need before the onset of the Euro as replacing a currency with one that was actually worth twice as much as the DM, would cause prices to rise, just like it did in the 1970's in Britain when we went decimal and suddenly when something went up in price by a penny it was actually 2,4 pence. The same has happened here, prices go up by a cent but that is actually 2 pfennings. She didn't believe me but I have been proven right.

 

Good post but inflation isn't really connected to the Euro. It is everywhere in all countries. 

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Salaries haven't kept up with the inflation even when it was low. Pandemic made it worse and now the high oil prices is making things worse. The property prices moving further out of Munich too has increased significantly. I've seen significant increase of prices of stuffs i buy from supermarket (e.g. fresh tomatoes were 2,59 - 2,79 which is now priced at 3,79). So yeah things are not rosy here (perhaps in and around Munich is just too expensive as living costs just keep going up).

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Did groceries today and checked the prices. My coffee (500 gr) went up from €5,99 last year to €6,49 and to €6,99 now (on sale for €3,99 instead of €3,49 previously). Rapeseed oil from €3,79 to €4,39 (on sale for €2,99). Hamburgers from €1,19 to €1,49 per 100 gr. Salted crisps from €1,49 to €1,69. Cake from €1,89 to €2,29. 
 

The beer price was €3,50 in 2010 (see post Allershausen). Now, it’s €4,00. That’s actually OK.

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14 hours ago, emale said:

 fresh tomatoes were 2,59 - 2,79 which is now priced at 3,79

Of course inflation today is very high.

But fresh tomatoes is as bad an example as it can be, their price is extremely dependent on weather and season.

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A--i just announced INCREASES in prices, what is the logic, does that loose them customers?

 

L--l claims to make no statements of that sort. Strange, there are adverts every week alleging price reductions.

 

I guess the prices are put up first, so they can be cut later 😉

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12 hours ago, LukeSkywalker said:

Did groceries today and checked the prices. My coffee (500 gr) went up from €5,99 last year to €6,49 and to €6,99 now (on sale for €3,99 instead of €3,49 previously). Rapeseed oil from €3,79 to €4,39 (on sale for €2,99). Hamburgers from €1,19 to €1,49 per 100 gr. Salted crisps from €1,49 to €1,69. Cake from €1,89 to €2,29. 
 

The beer price was €3,50 in 2010 (see post Allershausen). Now, it’s €4,00. That’s actually OK.

 

Rapeseed oil used to be 1.20 at Lidl. Now I can’t even find any type of oil. I have been to at least 5 supermarkets and the oil shelf is wiped clean except for the olive oils, which I don’t need at this moment. Where did you find oil?! 

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1 hour ago, klingklang77 said:

 

Rapeseed oil used to be 1.20 at Lidl. Now I can’t even find any type of oil. I have been to at least 5 supermarkets and the oil shelf is wiped clean except for the olive oils, which I don’t need at this moment. Where did you find oil?! 

I buy mine at Edeka. It’s organic rapeseed oil from Austria. Yesterday, there was plenty of stock. Others are sold out. Their shelve space was filled with it too. 
 

Perhaps you could try a Turkish supermarket or vegetable store.

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Apparently people are using cooking oil in diesel motors so this is also affecting availability. My local Netto has a one bottle per household sign - I assumed it was one bottle by oil type and took one olive and one cooking but the cashier told me to choose which one I wanted. I chose olive and the old guy behind me said 'I'll take the cooking oil so'.

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Shortage of flour too. And not only wheat apparently.

We just decided to ration within our household, no pizza tonight 🙁, the 600g we have left is more than enough but we rather save it for later.

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I was able to pick up 1050 grade flour (for bread and Pizzas) from DM, they had plenty in stock. Standard 405 grade was sold out but Edeka did have some more expensive brands left

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