Inflation hits middle-income families hard

Status: 01/21/2022 3:56 p.m

Households in Germany are affected to varying degrees by the high inflation. According to a study, middle-income families in particular are suffering from the recent significant rise in prices.

According to a recent study, the middle class is suffering particularly badly from rising prices in Germany. Measured against a standard basket of goods, consumer prices for middle-income families with children and middle-income couples without children rose 5.5 percent in December in December. The average exposure for all households was 5.3 percent. This is the conclusion reached by the Institute for Macroeconomics and Business Cycle Research (IMK) of the Hans Böckler Foundation.

Hardly any scope for basic consumption

On the other hand, single people with low incomes had the lowest household-specific inflation rate of 4.4 percent, according to the IMK: “Even for single people with high and middle incomes, the rates of 4.7 and 5.0 percent in December were slightly below the general rate price increase.”

However, this comparatively lower inflation rate for single people with low income proves to be “double-edged”, according to IMK expert Silke Tober. Because these households are severely affected by the sharp rise in the price of food and energy, basic necessities whose consumption can hardly be reduced. As a result, there is hardly any scope to save or to do without goods. Their comparatively low inflation rate is mainly due to the fact that these households cannot afford other goods and services anyway, the prices of which have also risen sharply. This applies above all to petrol and other expenses for the car and for travel.

“Inflation will weaken in the coming year”

The additional burden of higher prices was 5.3 percent for families with two children and low incomes, and 5.4 percent for families with higher incomes. “Roughly summarized, it can be concluded that inflation is currently not disproportionately affecting households with lower incomes,” says Tober. “We expect inflation to weaken noticeably again this year.” Nevertheless, inflation is a burden on households in Germany.

In December, inflation in Germany rose to 5.3 percent and thus to the highest level since 1992. The IMK determined the typical consumption patterns for different households on the basis of the income and consumption sample of the Federal Statistical Office. This makes it possible to weight who spends how much on certain goods and services – from food to rent, energy and clothing to cultural events and package tours. From this, the experts then calculated the household-specific price development.

Reference-www.tagesschau.de

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