Migrants earn 20 percent less than native Germans

A new study published in the academic journal Nature has found that migrants in Germany earn, on average, almost 20 percent less than native Germans. What’s more, wage discrepancies persist for second-generation migrants.

Nature study reveals wage inequality between Germans and migrants

A new study published in Nature with contributions from the German Institute for Employment Research (IAB), has found that first-generation migrants in Germany earn 19,6 percent less than Germans.

This wage gap is primarily due to the fact that migrants are employed in poorly paid jobs, rather than being employed in the same roles as Germans, but having lower incomes. “Segregation of workers with immigrant backgrounds into lower-paying jobs accounts for about three-quarters of overall immigrant–native earnings differences,” the study’s authors wrote.

Income inequality eases, but does not disappear, among second-generation migrants. According to the study, second-generation migrants in Germany earn an average of 7,7 percent less than native Germans, significantly over the international average discrepancy of 5,7 percent.

The study assessed wage inequality in native and migrant populations in eight additional countries. The largest discrepancies were found in Spain (29,3 percent), Canada (27,5 percent), Norway (20,3 percent), Germany and France (18,9 percent).

Countries must do more to support migrants, study argues

The study’s authors concluded that Western governments must do more to support migrants' schooling, access to language classes, improve access to domestic education, make it easier for migrants to have their qualifications recognised, and introduce job search assistance programmes.

When it comes to language learning, several German federal states are opting to test children’s German proficiency as they transition from Kita to school. But critics, including the German Education and Academia Union (GEW), have warned that the programme will “barely work in reality” due to staff shortages.

A 2019 study by the Institute for Economic Research (IW) in Cologne found that the better their German skills, the more migrant workers in Germany are paid. However, the country is set to halve funding for integration courses, which include learning German, from 1,1 billion to 500 million euros. 

The hurdles don’t stop there, according to a 2024 report from NDR, 90,3 percent of non-Germans in Hamburg have to defer starting training programmes (Ausbildungen) because waiting times to have their qualifications recognised are so long.

“Policies that target employer bias in hiring and promotion decisions are also likely to be effective,” the study explained. “[But] measures aimed at ensuring equal pay for equal work may have more limited scope for further progress in closing the immigrant–native pay gap”.