Closed shops and restaurants, the economic downturn and distance learning – the corona crisis has massive consequences.
The National Academy of Sciences Leopoldina fears the long-term worsening of income inequality in Germany due to the corona pandemic.
In the short term, the income losses of many people have been limited by the social security systems. In the long term, however, the crisis could have significant effects on the level and distribution of income, warn the scientists in the statement published on Wednesday “Economic consequences of the coronavirus pandemic – diagnoses and options for action”.
According to the experts, the pandemic poses new challenges for economic and social policy in Germany in the medium and long term, has increased the need for action that previously existed, but also offers opportunities. “The pandemic can become an opportunity for a society-wide modernization initiative, especially in the area of government action,” argued Leopoldina Vice President Regina T. Riphahn.
How the inequality in household income developed during the crisis is still unclear, the experts write. According to the information, however, mini-jobbers, among others, were hit hard. Since they are not insured in unemployment insurance, they do not receive any short-time work allowance. One option could be to include the mini-job workers in the short-time work scheme. The researchers’ criticism of the € 450 jobs is more fundamental. “Mini-jobs do not fulfill their intended” bridging function “for the transition out of unemployment.” Rather, it has been shown that they are in part displacing jobs that are subject to social insurance contributions. The experts suggest abolishing mini-jobs entirely, or at least significantly reducing them.
The researchers see a need for action in school education. The educational losses during the crisis threatened to have a long-lasting effect and reduce the income potential of the younger generation, especially of underperforming students and those from poorly educated families. This means that equal opportunities are even less than before the pandemic. The working group suggests, among other things, that in the event of possible future school closings, mandatory online lessons should be provided daily and that children and young people from disadvantaged social backgrounds should be given extensive support.
To overcome the economic consequences of the pandemic, the scientists recommend, among other things, the expansion of digitization and tax incentives for investments. “Digitization and accelerated structural change should not be feared as a threat, but should be sought as a prerequisite for higher overall economic productivity”, explained Christoph M. Schmidt, spokesman for the working group and president of RWI Essen and member of the Leopoldina.
In the opinion of the researchers, possible deficits in state crisis management should also be addressed. They therefore suggest setting up an independent, non-governmental commission after the crisis has subsided to work out proposed solutions.
Jane Stock is a technology author, who has written for 24 Hours World. She writes about the latest in technology news and trends, and is always on the lookout for new and innovative ways to improve his audience’s experience.
