One-fifth of full-time workers in Germany are low-wage earners

Working full-time hours and yet still only receiving a low wage: this is the reality for nearly 20 percent of full-time employees in Germany, according to a new study. 

18,7 percent of full-time employees earn less than 2.284 euros per month

Almost a fifth of full-time workers in Germany are low-wage earners who have to make ends meet on a gross salary of less than 2.284 euros per month. This is the main takeaway of a new study by the Economic and Social Science Institute (WSI) of the Hans Böckler Foundation. 

Someone is considered a “low-wage earner” if their gross monthly income is less than two-thirds of the median gross monthly wage of all full-time employees subject to social security. In 2020 - the year the report’s data comes from - that was 2.284 euros per month. Across the whole of Germany, around 18,7 percent of full-time workers earned less than this in 2020. 

“Receiving such a salary despite working full-time is poor,” said WSI researcher Eric Seils. “Those who are sole earners can hardly make a living from it, especially in areas with higher rents. And those who work permanently for this wage will only receive a very small pension.” 

Women, migrants and unskilled workers most likely to be low-wage earners

The report found that women, young people, those without German citizenship, and those without professional qualifications were much more likely to be on low wages. Although improvements have been made, there are also a significantly higher proportion of low-wage earners in the eastern federal states than in the west. 

Nationwide, 25,4 percent of women received a low monthly wage, despite working full time, compared to 15,4 percent of men. Education and training also play a major role, with employees without a vocational qualification making up 40,8 percent of low-wage workers. Those with a vocational qualification make up 17,8 percent, and employees with a higher education certificate make up just 4,9 percent of low-wage earners. 

There were also huge differences between industries. More than half of all full-time employees earn inadequate wages in the hospitality (68,9 percent), contract work (67,9 percent) and agriculture and forestry (52,7 percent) industries. In the metal and electrical industry, the proportion was just 7,6 percent. In finance and insurance, it was 4,2 percent, and, in the public sector, it was a tiny 2,5 percent of full-time employees. 

Progress has been made, particularly in eastern Germany

There has, however, been progress. In 2011, 21,1 percent of full-time employees were low-wage earners. “In recent years, we have succeeded in pushing back the lower pay range,” said Helge Emmler, one of the report’s authors. 

The 10-year economic boom before the coronavirus pandemic reduced the proportion of low-income workers, Emmler explained, in the east particularly. In the new federal states, the proportion of low-income workers shrank from almost 40 percent to just under 30 percent within the space of 10 years.