Annual Report of the Federal Government on the Status of German Unity in 2016 Imprint Publisher The Federal Ministry for Economic Affairs and Federal Ministry for Economic Energy was awarded the audit berufundfamilie® Affairs and Energy (BMWi) for its family-friendly staff policy. The certificate Public Relations is granted by berufundfamilie gGmbH, an initia- D-11019 Berlin, Germany tive of the Hertie Foundation. www.bmwi.de Text and editing Federal Ministry for Economic Affairs and Energy (BMWi) Task Force on the New Federal States Design and production PRpetuum GmbH, Munich Status September 2016 Print BMWi This publication as well as further publications can be obtained from: Illustrations Federal Ministry for Economic Affairs gameover2012 – iStockphoto and Energy (BMWi) This brochure is published as part of the public relations work Public Relations of the Federal Ministry for Economic Affairs and Energy. 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Fax: +49 30 18102722721 1 Annual Report of the Federal Government on the Status of German Unity in 2016 2 Contents Preliminary remarks........................................................................................................................................................................................................................................................ 6 Part A ........................................................................................................................................................................................................................................................................................... 6 I. Current challenges in eastern Germany.................................................................................................................................................................................................. 7 Quality of life in the eastern federal states.............................................................................................................................................................................................7 Economic development – convergence...................................................................................................................................................................................................8 A fragmented economy, structural weakness . .8 Boosting innovative strength . 9 Securing skilled workers ..........................................................................................................................................................................................................................10 Right-wing extremism and xenophobia ..............................................................................................................................................................................................10 Pension alignment and social unity........................................................................................................................................................................................................11 II. Structural changes and their relevance for eastern Germany ............................................................................................................................................. 11 Integration of refugees, immigration and migration ..................................................................................................................................................................11 Digitisation..............................................................................................................................................................................................................................................................12 Energy transition ................................................................................................................................................................................................................................................13 III. Prospects for a policy for eastern Germany ......................................................................................................................................................................................... 14 Part B Report ....................................................................................................................................................................................................................................................................... 15 I. Improving economic strength, completing social unity ......................................................................................................................................................... 16 1. Supporting structurally weak regions.............................................................................................................................................................................................16 1.1. Solidarity Pact II ..............................................................................................................................................................................................................................16 1.2. Key issues paper for an all-German funding system to support economically less developed regions..................................16 2. Promoting investment, innovation and international isation .........................................................................................................................................17 2.1. The economic structure and research landscape in eastern Germany ........................................................................................................17 2.2. Promoting investment . 18 2.3. Start-ups ...............................................................................................................................................................................................................................................19 2.4. Promoting innovation and research .................................................................................................................................................................................20 2.5. Internationalisation . 22 2.6. Business clusters..............................................................................................................................................................................................................................23 2.7. Digitisation and Industry 4.0 ..................................................................................................................................................................................................23 3. Labour market and securing skilled workers .............................................................................................................................................................................24 3.1. Situation on the labour and training market in eastern Germany, employment development .................................................24 3.2. Measures to integrate refugees into the labour market .........................................................................................................................................27 3.3. Measures to secure skilled workers .....................................................................................................................................................................................29 4. Income, wealth, pensions ........................................................................................................................................................................................................................35 4.1. Companies covered by collective bargaining and wage trends.........................................................................................................................35 4.2. Minimum wage................................................................................................................................................................................................................................36 4.3. Income and wealth situation of private households ...............................................................................................................................................38 4.4. Pensions and pension alignment .........................................................................................................................................................................................41 CONTENTS 3 II. Securing the performance of the eastern federal states and municipalities, warranting basic vital services .................................................................................................................................................................................................................... 41 1. Performance of the federal states and municipalities ..........................................................................................................................................................41