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|February 2018: Good development on the labour market
Unemployment figures in Germany
with other European countries, Germany seems to have low
unemployment figures. But the lack of jobs is still a big problem
as there are some German regions that have much more higher
unemployment rates than others. In contrast, there are some
sectors of the German economy where employers have difficulties to
find adequate staff.
In February 2018, approximately 2.546 million men and women were without work in Germany, a country with a population of more than 82 million people. The number of unemployed men and women fell by 24,000 compared with the previous month and fell by 216,000 compared with February 2017. The official unemployment rate provided by the German Federal Employment Agency (Bundesagentur für Arbeit) is 5.7%. Since January 2014, the monthly unemployment rate is lower than the rate in the corresponding month a year ago.
The methods used by the German employment agency are different from the standards used by the International Labour Organization (ILO). If the concept of the ILO is used, there are 1.57 million unemployed job seekers in Germany in January 2018, the unemployment rate is 3.6% according to the ILO standards.
"Good development on the labour market continues in February: Unemployment and underemployment have fallen, employment subject to social security insurance contribution continues to grow and labour demand remains at a very high level", Detlef Scheele, chairman of the board of the Federal Employment Agency, says while presenting the figures for the second month of 2018.
there were 216,000 less people unemployed than in February 2017
and 22,000 less than the previous month.
According to the German Federal Statistical Office, 44.28 million people were in gainful employment in Germany in January 2018 (a plus of 625,000 compared with January 2017). In December 2017, 32.56 million people had a job that was subject to social insurance contributions, the agency told (a plus of 711,000 compared with last year).
In February 2018, the Federal Employment Agency registered 764,000 job vacancies, 90,000 more than a year ago.
The underemployment was at 3.514 million people, 232,000 less than last year's February. "Underemployed" people are not only "unemployed" people but for example also persons who take part in employment market policy relieving measures or job-seekers who have a part-time work (but workers with reduced working-hours are not included). (Source: press release of the Federal German Employment Agency of 2018-02-28).
Who is unemployed?
In Germany, a job seeking person is unemployed if she or he is able to work, does not work 15 hours a week or longer and is registered as an "unemployed" person at the local labour agency's office or job centre. The unemployed person must look for an occupation that lasts at least 15 hours a week. Further on, only a person who has not yet reached the retirement age and is not on sick leave can be "unemployed". The unemployed must be willing to work and accept any work, he or she has not the right to accept only a work that is similar to the previous one. An unemployed person who is 58 years old or more and receives welfare benefits for at least 12 months and has not got a job offer by the labour agency will not be counted as "unemployed".
Picture above: View of the Brandenburg Gate in Berlin (CC BY-SA 3.0, Berthold Werner). In February 2018, the unemployment rate in the capital of Germany was 8.7%. (Source: Press release of the Regionaldirektion Berlin-Brandenburg of the Bundesagentur für Arbeit of 2018-02-28).
Picture above: The headquarters of the German Federal Employment Agency in Nuremberg. (CC BY-SA, Achates).
|Two social security
benefits for unemployed persons
In Germany, there are principally two different social security systems for unemployed workers. The first one is an obligatory insurance system that includes all working persons who earn a wage of more than 450 euro a month. Contributions to the insurance against unemployment are paid by employers and employees half. In 2018, the monthly sum for this insurance is 3.0% of the monthly gross income. For example: someone gets a gross wage of 1,000 euro a month. The employee has to pay 15 euro a month and the employer too. The sum paid by the employer is additional to the gross income, the employer transfers the entire contribution to the social security authorities. For receiving unemployment money, an unemployed person must have paid contributions for at least twelve months in the last two years. The period for which unemployment money will be paid depends on the time an unemployed person has paid contributions. If someone has paid contributions for not longer than twelve months, the benefit will expire after six months, if someone has paid contributions for 24 months, the beneficiary will get this support for a maximum of twelve months. Longer periods are applicable for older unemployed men and women. The unemployment money will replace 60% of the net income of the last twelve months before unemployment (it will be 67% if the unemployed person or his or her partner cares for a child).
The other social security benefit for unemployed people is called Arbeitslosengeld II ("unemployment money 2") which has replaced the former welfare (in German: "Sozialhilfe") for those who are mentally and physically able to work. Therefore the unemployment benefit derived from the unemployment insurance system is often called "Arbeitslosengeld I" (unemployment money 1). "Arbeitslosengeld II" is being financed by the general tax revenue. For a single person, it amounts to 416 euro in 2018 or, for partners, to 374 euro for each partner. Children living with their parents receive 240 euro until they are six years old, 296 euro until 14 years and 316 euro until 18 years. Children from 18 to 25 years staying with their parents get 332 euro. Most other incomes will be taken into account with "unemployment money 2", especially child benefit (in German: "Kindergeld"). In addition, the costs for appropriate housing including heating will be covered. Both unemployment benefits will be paid if an unemployed man or woman gets only little unemployment money that does not secure his livelihood.
In February 2018, 845,000 unemployed persons were supported financially by the unemployment insurance system, 50,000 less than last year's February (Source: press release of the Federal German Employment Agency of 2018-02-28).
|Unemployment in Europe
in recent months (according to Eurostat, the statistical
office of the European Union, seasonally adjusted)
The ways Eurostat uses for calculating the unemployment rate differ from the standards used by the German Federal Employment Agency (see below). It is estimated that 17.931 million men and women were unemployed in the European Union in January 2018. The number of unemployed persons fell by 19,000 compared with December 2017 and fell by 1.867 million compared with January 2018. The rate of 7.3% is the lowest rate in the EU28 since October 2008.
Younger job seekers: In the entire EU, 3.646 million young people under 25 years of age were unemployed. The average youth unemployment rate was 16.1%. The highest rates were found in Greece with 43.7% (in November 2017), in Spain with 36.0% and in Italy with 31.5%, followed by Cyprus with 25.1% (in October 2017), Croatia with 24.5% (in December 2017), Portugal with 22.1% and then France with 21.7%. Germany had the third lowest rate with 6.6% (after Czechia with 5.8% and Estonia with 6.5% in December 2017). (Source: Press release of Eurostat nr. 34 of 2018-03-01).
the entire year 2017 in Germany
In January 2018, the German Federal Labour Agency published the unemployment figures for the entire year 2017. In that year, an average of 2.533 million persons were registered as unemployed in Germany, the average unemployment rate was 5.7% (compared with 2016: a decline of 158,000 and a decline of 0.4 percentage points). The number of those in gainful employment rose to its highest level since German reunification (44.27 million, a plus of 638,000). "The labour market developed very well in 2017: the number of unemployed people fell, for the fourth year in a row, on average for the year; employment subject to social security contributions rose sharply and the demand by companies for new employees increased again, year-on-year. The labour market has benefited, not the least, from a broad-based economic upturn", Detlef Scheele said, chairman of the Executive Board of the German Employment Agency. On average, 731,000 vacancies were registered with the agency in 2017, 75,000 more than the previous year. (Source: Press release nr. 2 of the Bundesagentur für Arbeit of 2018-01-03).
Unemployment among foreigners
Unemployment among foreigners is higher than among Germans. In February 2018, 664,000 foreigners were registered as "unemployed" which means that every fourth unemployed person is not a German (26.1%).
(Source: Statistik der Bundesagentur für Arbeit, Berichte: Blickpunkt Arbeitsmarkt – Monatsbericht zum Arbeits- und Ausbildungsmarkt, Nürnberg, Februar 2018, page 12).
According to the German Federal Statistical Office, 10.5% of the German population were foreigners in 2015. (Source: Press release of the German Federal Statistical Office nr. 295/16 of 2016-08-26).