Bad News Gerhard

As Herr Schroeder attempts to get to grips with Germany’s economic problems, here’s something for him to ponder:

Labour costs in the new members of the European Union are on average less than a quarter of the level of the older member states. This is a massive difference from the costs in Old Europe.

The highest annual employment costs according to the European study were in Belgium, Sweden and Germany where the total financial burden of employing a worker, including benefit costs, was more than €50,000 ($58,500) a year.

Germany may have incredibly productive workers, but it also has massively expensive non wage employee costs. This is a symptom of the disease that is afflicting much of Western Europe. Taxes are largely taken before they reach a worker’s payslip, as employer contributions, in the con trick that pretends that they cost is borne by employers.

The idea of heavily taxing employment is so economically ignorant, that it is hard to believe that it is so widespread. Reducing this government induced unemployment is the only how for the economies of old Europe, if they want to compete.