Industrial inversion: Italy is more convenient than Germany (On the skin of the workers ..)
We present two excellent graphs, elaboration of an ancient and fundamental collaborator of Economic Scenarios, which correlate Italian and German industrial production, and therefore the cost of labor per unit of Italian and German product, and which are useful for explaining a sure, light, industrial repositioning between Germany and Italy
Here are the data: the first graph starts from 1996, given at 100 and indicates the relative relationship between German and Italian industrial production.
This second, given the value 100 again in 1996, instead correlates the cost of labor per unit of Italian and German product.
It is clear that the post-2008 crisis has strongly affected the cost of labor per unit of product in the Italian industry, especially when compared to the German one. This was due to the combination of wage deflation (decline in Italian real remuneration compared to Germanic ones) and automation procedures. The effect was clearly felt on the comparative production between Italy and Germany, with a recovery, actually very slow, but present of our production compared to that of the other side of the Alps.
Who paid for this process? Obviously the workers, who have seen their wages compressed also for the austerity policy begun with the Monti government. Furthermore, despite the 2020 crisis, the process is proceeding, indeed it will probably even accelerate in the future, especially due to the sensitive inflationary differentials between Italy and Germany and the explosion of German real estate prices with a strong impact on household costs. The green conversion and the new "Traffic Light" government could even worsen the situation, to the detriment of Berlin.
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The article Industrial Inversion: Italy is more convenient than Germany (On the skin of the workers ..) comes from ScenariEconomici.it .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/inversione-industriale-litalia-conviene-di-piu-della-germania-sulla-pelle-dei-lavoratori/ on Wed, 17 Nov 2021 13:30:56 +0000.