The highest purchasing power lives away from the expensive cities
How wealthy or poor you are depends not only on your income, the regional cost of living also plays a role. If the ranking of incomes in the 400 German districts, counties and cities is adjusted accordingly, the large cities fall drastically in some cases, as calculations by the German Economic Institute (IW) on price-adjusted disposable income per capita, which were made available to Deutsche Presse-Agentur, show.
The new ranking throws a lot of things upside down: in many cases, the cities have moved up or down by well over 100 places, and twice by more than 250.
The wealthiest
At the very top: rich remains rich. According to the IW calculations, the highest disposable annual income in regional prices is found in the Bavarian district of Starnberg at a good 32,800 euros. That is 34.7 percent more than the national average. Starnberg is already number one in terms of nominal income and the lead is simply so great that it is not offset by the high cost of living, which is 14.1 percent higher than the national average.
The next four places are also occupied by cities, districts or counties that are already far ahead in terms of nominal income: Hochtaunuskreis 27.1 percent above the national average, Baden-Baden with 26.5 and the districts of Miesbach and Munich with 19.8 and 18.6 percent above-average price-adjusted incomes respectively.
The poorest
Even at the very bottom, the poor remain poor: the IW experts calculate the lowest price-adjusted disposable annual income for Gelsenkirchen. At 18,886 euros, it is 22.5 percent below the national average. The city has the red lantern even before the price adjustment. The 5.1 percent below-average costs there no longer change this. It is followed by Offenbach am Main, Duisburg, Herne and Freiburg, which are 21.7 to 16.2 percent below the national average.
The role of the cost of living
At the end points of Starnberg and Gelsenkirchen, the regional cost of living may not change anything in the unweighted income ranking, but in between they do throw things into disarray. However, this is also due to the fact that some of the differences are only relatively small, especially in the midfield.
Overall, the regional costs level out the differences in income to a certain extent. "The spread is getting smaller," says Christoph Schröder from the IW. The differences between East and West are also decreasing.
The relegated
In view of their high cost of living, some of the major cities have fallen by more than 200 places: Stuttgart is down 259 places: 301st place instead of 42nd. For Frankfurt am Main, it goes from 118th place to 370th and Hamburg plummets from 64th to 297th. Cologne also lost a lot of ground: 183 places from the upper midfield to 349th place.
Of the group of the seven largest cities, only Munich and Düsseldorf remain in the richer half after the price adjustment. Thanks to costs that are only 8.5 percent above average, Düsseldorf only falls from 19th to 103rd place, while Munich's outstandingly high nominal income in second place cushions its fall despite having the highest costs in Germany. The Bavarian capital thus remains at least in the extended top group with 24th place in terms of price-adjusted income.
However, there are also smaller cities and rural districts that plummeted down many places due to high costs. These include Heidelberg, Ingolstadt and the district of Freising. And Freiburg's high cost of living even pushed it down almost to the bottom: 396th place instead of 270th.
The climbers
The biggest climbers in terms of the number of places climbed are all rural districts. Above all Tirschenreuth, which gained 140 places thanks to low prices and jumped from 200th to 60th place. The Vulkaneifel district improved by 139 places, Cochem-Zell by 135 and the districts of Hof and Regen by 133 and 132 respectively. There are no large cities in this group. People in rural areas often have a good income, says Schröder. The district of Olpe in North Rhine-Westphalia, for example, ranks 25th in terms of nominal income. Together with a cost of living below the average, this is enough for ninth place in terms of real income.
The basis of the ranking
The ranking is based on data on nominal income from the Federal Statistical Office as of 2021, which the IW combined with an index of the regional cost of living at district, county and city level that it recently published together with the Federal Institute for Research on Building, Urban Affairs and Spatial Development (BBSR). The price index is based, among other things, on 24 million pieces of partially automated price data collected in 2022. Housing costs were the decisive factor for major differences.
The ranking does not take into account differences in the expenditure structure, for example that city dwellers may have lower commuting costs than people from cheaper rural districts.
- Consumers in Gelsenkirchen, despite having a lower income, are affected more by the cost of living due to its 5.1% below-average costs, which keeps it at the bottom of the income rankings.
- Starnberg, with a high disposable income of 32,800 euros, remains wealthy even after adjusting for the region's cost of living, which is 14.1% higher than the national average.
- The cost of living in Frankfurt am Main is one of the reasons it has fallen by 251 places in the price-adjusted income ranking, now at 370th place instead of the original 118th.
Source: www.dpa.com
