Examining a directive to compile a report on the specified matter has been outlined for the Commission.
In a recent study conducted by the Institute for Economic and Social Research (WSI) of the Hans-Böckler Foundation, it has been revealed that full-time workers earning the minimum wage in Germany have only slightly higher disposable incomes than those receiving unemployment benefits.
According to the study, a single mother working full-time at the minimum wage, with a five-year-old child, would have a net income of 1,636 euros. However, with child benefit, child supplement, housing benefit, and maintenance advance, her income increases to 2,532 euros. On the other hand, a single man earning the minimum wage would have a gross monthly income of 2,121.58 euros, leaving 1,546 euros after deducting taxes and social security contributions.
The study also highlights that the wage gap between employed individuals earning the minimum wage and unemployment benefit recipients varies regionally. The smallest gap is found in Munich district, Dachau, and Munich city, where employed individuals earning the minimum wage have 379 to 444 euros more than unemployment benefit recipients. However, in Nordhausen and Vogtland district, the gap is much wider, with employed individuals earning 662 and 652 euros more than unemployment benefit recipients.
Critically, the study contradicts the assumption that unemployment benefits are so high that the incentive to take low-paid work is lacking. In fact, a couple with one earner on the minimum wage and two children aged five and 14 would have 660 euros less in unemployment benefit, according to the study's calculations.
In response to these findings, Bettina Kohlrausch, the director of the WSI, emphasized that unemployment benefit recipients, regardless of household type and region of residence, have less money than employed individuals earning the minimum wage. She also stated that the claim that unemployment benefit recipients do not want to be employed because they can live well on unemployment benefits is factually incorrect and stigmatizing.
Meanwhile, Michael Hüther, the head of the employer-friendly Institute of the German Economy, has noted that despite the increase in citizen's income, the wage gap regulation remains intact. He also critically noted that often, overtime in the low-wage sector is not worthwhile.
In light of these findings, Kohlrausch suggested creating affordable housing and qualifying employable people on unemployment benefits, instead of increasing unemployment benefits, as a way to address the issue of low wages and income inequality.
finance and business: The study critically contradicts the assumption that unemployment benefits are so high that the incentive to take low-paid work is lacking, a claim often made in the business realm. Instead, the study shows that unemployment benefit recipients, regardless of household type and region of residence, have less money than employed individuals earning the minimum wage, thus impacting their financial situation significantly.
regional and employment: According to the study, the wage gap between employed individuals earning the minimum wage and unemployment benefit recipients varies regionally. The smallest gap is found in Munich district, Dachau, and Munich city, while in Nordhausen and Vogtland district, the gap is much wider, demonstrating a regional disparity in the employment sector.
