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|July 2018: Small increase due to seasonal reasons
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 July 2018, approximately 2.325 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 rose by 49,000 compared with the previous month and fell by 193,000 compared with July 2017. The official unemployment rate provided by the German Federal Employment Agency (Bundesagentur für Arbeit) is 5.1%. 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 1.49 million unemployed job seekers in Germany in June 2018, the unemployment rate is 3.5% according to the ILO standards.
Unemployment and underemployment increased in July for seasonal reasons alone, with declines after seasonally adjusted. "The development in the labour market is therefore very favourable, but not so lively", Detlef Scheele, chairman of the board of the Federal Employment Agency, says while presenting the figures for the seventh month of 2018.
there were 193,000 less people unemployed than in July 2017
and 6,000 less than the previous month.
According to the German Federal Statistical Office, 44.94 million people were in gainful employment in Germany in June 2018 (a plus of 580,000 compared with June 2017). In May 2018, 32.88 million people had a job that was subject to social insurance contributions, the agency told (a plus of 746,000 compared with last year).
In July 2018, the Federal Employment Agency registered 823,000 job vacancies, 72,000 more than a year ago.
The underemployment was at 3.258 million people, 242,000 less than last year's June. "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 2018-07-31).
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 Berln (CC BY-SA 3.0, Berthold Werner). In June 2018, the unemployment rate in the capital of Germany was 8.1%. (Source: Press release of the Regionaldirektion Berlin-Brandenburg of the Bundesagentur für Arbeit of 2018-07-31).
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 July 2018, 705,000 unemployed persons were supported financially by the unemployment insurance system, 25,000 less than last year's July (Source: press release of the Federal German Employment Agency of 2018-07-31).
|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 17.105 million men and women were unemployed in the European Union in June 2018. The number of unemployed persons rose by 4,000 compared with May 2018 and fell by 1.657 million compared with June 2017. The rate of 6.9% is the lowest rate in the EU28 since May 2008.
Younger job seekers: In the entire EU, 3.415 million young people under 25 years of age were unemployed. The average youth unemployment rate was 15.2%. The highest rates were found in Greece with 42.3% (in April 2018), in Spain with 34.1% and in Italy with 32.6%, followed by Croatia with 22.7% (second quarter 2018), Cyprus with 22.3% (first quarter 2018), France with 20.4% and then Portugal with 19.6%. Malta had the lowest rate with 5.5%, followed by Germany with 6.2% and the Netherlands with 7.2%. (Source: Press release of Eurostat nr. 125 of 2018-07-31).
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 July 2018, 618,000 foreigners were registered as "unemployed" which means that every fourth unemployed person is not a German (26.6%).
(Source: Statistik der Bundesagentur für Arbeit, Berichte: Blickpunkt Arbeitsmarkt – Monatsbericht zum Arbeits- und Ausbildungsmarkt, Nürnberg, Juli 2018, page 13).
According to the German Federal Statistical Office, 11.3% of the German population were foreigners at the end of 2017. (Source: Survey "Bevölkerung und Erwerbstätigkeit. Ausländische Bevölkerung, Ergebnisse des Ausländerzentralregisters 2017, page 18, published by the German Federal Statistical Office on 2018-04-12).