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MONEY

Why Germany will not raise unemployment benefits next year

Bürgergeld allowance - the long-term unemployment benefit - will not be increased next year, the German government says.

Published: 5 September 2024 10:56 CEST
A person looks at the Job Centre's website.
A person looks at the Job Centre's website. Photo: picture alliance/dpa | Jens Kalaene

The coalition government usually raises the Bürgergeld allowance – which those who are long-term unemployed receive – at the turn of the year.

But according to Labour Minister Hubertus Heil, of the Social Democrats (SPD), the falling inflation rate means there will be no increase in 2025.

Inflation fell to 1.9 percent in August – the lowest level in more than three years. “And that’s why the figures and the legal mechanism mean that, as predicted, there will be no increase in ‘citizens’ benefits’ on January 1st,” Heil said. “And that is the right thing to do.”

Heil said people in Germany who are not in work must be supported. “But it is also clear that this is the minimum subsistence level, no more, no less,” he added.

When the first tier of unemployment insurance runs out in Germany – typically after one year of not working – Bürgergeld (known as Unemployment II) kicks in at a fixed amount. 

At the moment, Bürgergeld recipients can expect €563 per month along with the payment of other living expenses and housing. The monthly payment was increased by 12 percent at the start of this year. 

However, that was controversial to the SPD’s coalition partners, the Free Democrats (FDP). Justice Minister Marco Buschmann (FDP) had recently even brought a reduction of the payment into play – but this was swiftly rejected by the Labour Ministry. 

The FDP has also been pushing for tougher sanctions on benefit recipients, which the coalition has put together a plan for. 

READ ALSO: How the German government wants to toughen up rules on unemployment benefits

This comes amid budgetary pressures. The coalition is debating how to make savings in the coming year’s budgets. 

What’s the reaction?

The move has been met with some opposition. The German Parity Welfare Association (Paritätische Wohlfahrtsverband) said the decision was a “step backwards”.

“Bürgergeld is still far too low, prices are continuing to rise and not increasing it would be a step backwards in terms of social policy,” Chief Executive Joachim Rock told Redaktionsnetzwerk Deutschland.

“Just because the inflation rate is falling does not mean that the burden is also falling.”

READ ALSO: How generous is Germany’s unemployment benefit system?

Rock also criticised the methods used by the government to calculate the rate and called for inflation to be compensated for. According to the association, the standard rate of €563 for a single adult means “a healthy diet, adequate mobility and social participation regularly are not possible”. 

Rock repeated the association’s previous demand for an amount of €813 per month to be given to Bürgergeld recipients. 

The welfare association also rejected the FDP’s criticism that the last increase of Bürgergeld was too high and a reduction was necessary.

“People who receive the ‘citizen’s allowance’ have no savings or savings accounts with which they can bridge emergencies,” Rock said. 

Around 5.5 million residents in Germany receive the Bürgergeld benefit.

READ ALSO: Can I get unemployment benefits in Germany if I quit my job?

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IMMIGRATION

Which countries have an immigration deal with Germany?

In a move to encourage skilled immigration into the country, Germany has signed two new migration pacts with Kenya and Uzbekistan. Which countries have similar deals with Germany - and what do they mean?

Published: 16 September 2024 12:29 CEST
Which countries have an immigration deal with Germany?

Germany’s urgent search for skilled workers is well known – and over the past few years, the government has been throwing everything at the problem. 

One of the most notable attempts to tackle labour shortages is the Skilled Worker Immigration Law, which came into force in phases in 2023 and 2024. Among other things, this new law loosened the salary requirements for Blue Card holders, created a new points-based visa for jobseekers, relaxed rules for international students and paved the way for easier family reunification.

With so many big changes coming into force with the Skilled Worker Law, far less attention has been paid to a series of pacts that the government has been signing with non-EU countries around the world.

Nevertheless, these deals are a cornerstone of the government’s attempts to get young, qualified workers into the country, and they’re likely to have a significant impact on immigration to Germany in the coming years. 

READ ALSO: 8 things to know about Germany’s new skilled worker immigration law

Who currently has an immigration deal with Germany? 

Back in December 2022, German Foreign Minister Annalena Baerbock signed the first of its new immigration deals with India, paving the way for easier mobility between the two countries.

It was the outcome of several months of intensive negotiations and covered employment for skilled workers in both the scientific and cultural sector, as well as students and trainees. 

At the time, around 200,000 Indians were living in Germany, including around 34,000 international students. By the end of 2023, this had shot up to 246,000, suggesting that the migration deal was already having a profound impact.

READ ALSO: ‘Germany needs you’ – Labour Minister’s plea to skilled workers from India 

The next migration deal was concluded in December 2023 with Georgia – a country that is currently applying for EU membership. At the same time, the eastern European country was reclassfied as a safe country of origin, meaning asylum applications from Georgia would be generally denied. 

Previously, around 15 percent of rejected asylum applications in Germany had come from Georgia and Moldova – a number that dropped significantly after the new deal was announced. As with India, the aim of the deal was to improve routes for skilled migration, though with a population of just 3.7 million, Georgia is a far smaller country.

William Ruto Olaf Scholz

German Chancellor Olaf Scholz (R) and Kenya’s President William Ruto shake hands at the end of a joint press conference. Photo: Tobias SCHWARZ/AFP.

At the start of 2024 came the next two deals with Morocco and Colombia, deepening Germany’s ties with the populous African and Latin American countries. In a visit to Morocco in January, Interior Minister Nancy Faeser (SPD) pledged to work more closely with her Moroccan counterparts on migration and other domestic issues.

The Colombia deal also reflects Germany’s recent attempts to woo young people in Latin American countries to bring their qualifications and expertise to Europe’s largest economy. Back in June 2023, Labour Minister Hubertus Heil (SPD) signed a “declaration of intent” with Brazil “to promote the mutual exchange of skilled workers”.

READ ALSO: How Germany is partnering with Brazil to recruit more skilled workers

Though this stopped short of a full migration pact, the aim was to encourage some of the 2.5 million qualified nurses in Brazil to come and work in Germany’s struggling care and health sectors. 

Most recently, this September, two further deals were concluded with Kenya and Uzbekistan. Celebrating the Kenya deal, Chancellor Olaf Scholz pointed to the fact that the country has “an unbelievable amount of IT expertise” within the population: an area of the workforce that Germany is desperate to strengthen.

According to the Interior Ministry, Germany is currently in the process of thrashing out additional deals with Ghana, Kyrgyzstan and the Philippines. An upcoming migration pact with Moldova has already been largely implemented.

What do the migration pacts say?

Though each of the migration agreements has its own regional inflections, all of them broadly cover two main objectives: encouraging skilled workers, students and trainees to come to Germany, and helping the government send back those who are living here illegally.

When it comes to the former, this involves offering fresh routes for people from those countries to find skilled employment or a placement for studies or vocational training in Germany. Many of the countries Germany has deals with have younger populations with higher unemployment rates. 

With the latter, Germany’s partner countries generally agree to loosen up their rules for accepting illegal migrants back into the country, as well as helping identify who might be in Germany without a permit.

In the case of the Kenya deal, for example, the Interior Ministry noted that Kenya was the first country south of the Sahara to agree to help identify irregular migrants through biometric data. Additionally, the Kenyan government has agreed to accept expired passports and ID cards to make it easier for Kenyans who have been in Germany for several years illegally to return home. 

READ ALSO: Germany and Kenya strike labour migration deal

Speaking to regional media outlet BR24, migration researcher David Kipp said it would take time for Germany to see the positive effects of the new pacts. However, Kipp believes that they could play an important role in Germany’s efforts to combat its labour shortages.

In the case of India – the earliest of the recent migrations pacts – the fact that around 50,000 Indian citizens came to Germany within the first year alone demonstrates the country’s pull for skilled migrants, Kipp added.

However, the researcher believes that other deals – such as those between the EU and Egypt and Tunisia – are likely to have a larger impact on curbing irregular migration. That said, these deals have been criticised for encouraging human rights abuses, such as Tunisia’s recent “pushbacks” of irregular migrants into the surrounding desert. 

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