Is the value of work greater than the financial investment of citizens?
In a groundbreaking study, the Institute for Economic and Social Research (WSI) of the Hans-Böckler-Foundation has found that full-time minimum wage earners in Germany receive significantly higher earnings than basic income recipients (citizen’s benefit recipients), regardless of household type.
The study provides an overview of the financial differences between employed individuals and basic income recipients across Germany. It examined various household situations, including single individuals and families.
The key finding of the study is that a single person earning minimum wage, after deductions and with a housing allowance claim, has a net monthly income of approximately 1,572 euros. In contrast, a basic income recipient in a similar living situation receives around 1,015 euros, resulting in a difference of over 500 euros.
For couples with children, the income from work exceeds basic income by several hundred euros. For instance, a mother with a five-year-old child earning minimum wage, including child benefit, housing allowance, and other supplements, has a net income of 2,532 euros.
The wage gap is also evident for single parents. A mother with a five-year-old child receiving basic income, including supplementary benefits such as housing allowance and child benefit, has a net income of approximately 1,783 euros - a difference of almost 750 euros.
The study contradicts the claim that basic income is so generous that working for minimum wage doesn't make sense. Michael Hüther of the employer-friendly Institute of the German Economy also confirmed that the wage gap is maintained.
Despite the supplementation through benefits, the gap remains consistently in favour of the employed. Bettina Kohlrausch, director of the WSI, emphasized that basic income recipients have significantly less income than employed individuals. Kohlrausch stated that the claim that basic income recipients don't want to work because it pays off is factually incorrect.
Kohlrausch suggested that it is crucial to create affordable housing and better qualify people receiving basic income. Hüther noted that overtime in the low-wage sector often has only minor effects for those affected.
The debate about basic income should focus less on stigmatization and more on solutions such as qualification and housing, according to Hüther. The study's findings underscore the economic disparity between employed workers and basic income recipients in Germany, providing valuable insights for policymakers and advocates alike.
The study's findings show that despite supplementation, the net income of employed individuals earning minimum wage consistently outweighs that of basic income recipients, regardless of household situation. For instance, a single minimum wage earer has a net income of approximately 1,572 euros, while a basic income recipient in a similar situation receives around 1,015 euros, demonstrating a difference of over 500 euros. Furthermore, the economic disparity between employed workers and basic income recipients in Germany is highlighted by the study, offering significant insights to policymakers and advocates in the general-news, business, finance, and politics sectors.
