Just two months ago, Germany emerged as the third largest economy on the planet, surpassing the languishing Japan.
The new figures from the German Federal Statistical Office, however, demonstrate that this is currently only true on paper. The number of Germans facing the specter of poverty or social exclusion remains high.
They number 17.7 million, the new survey of income and living conditions shows. Compared to the previous year, the figures appear almost unchanged.
In reality, however, the situation is getting worse. 17.5 million people or 21.1% of Germans were in the same position in 2022. This means that the perceived “steam engine of Europe” is below the EU average, which stands at 21.6%. The criteria are the same.
A person is considered to be at risk of poverty or social exclusion in the EU if at least one of three basic conditions applies.
- His income is below the poverty line.
- His household suffers from significant material and social deprivation.
- Adult family members, aged 18-64, have very low labor force participation.
Bridging a socioeconomic divide
Germans at risk of poverty or social exclusion have an income below 60% of the national average. In this category, in 2023, it was about one in seven.
The limit was per person at 1,310 euros net per month (after taxes and social security contributions). For families of four with two children under the age of 14, the corresponding amount is set at 2,751 euros net on a monthly basis.
Those who are now below these levels represent 14.3% of the population. They number almost 12 million people. In 2022, the corresponding percentage was somewhat higher, at 14.8%.
But the “closing of the scissor” is practically considered to be negligible. The situation is worse in terms of the bar of impoverishment defined by significant material and social deprivation.
“This means that living conditions are significantly limited due to a lack of financial resources,” the German statisticians explain. A prime example of the victims? They are unable to pay their rent, mortgage and utility bills.
Or go out for a meal or some other kind of fun once a month. 6.9% of Germany’s population or 5.7 million people are in this position today. In 2022 it was at 6.2%.
And 9.8% of the population belongs to the category of very low participation in the labor force of adult members (under the age of 65) of a household. This is 6.2 million Germans. The percentage remains the same as in 2022.
This stagnation essentially translates into policy failure, post-pandemic. Add the data available for comparison with other EU countries. are limited.
Based on the data so far, the Czech Republic has the lowest percentage of people at risk of poverty or social exclusion, at 12%. The “champion” with a negative sign is Bulgaria, with 30%.
Bells “are ringing“
Just two weeks ago, meanwhile, the five leading economic institutes in Germany drastically revised down their forecasts for this year.
They expect very low growth for the German economy, of just 0.1%. “Economic and structural factors” were cited for the revision at hand (last autumn growth was forecast at 1.3%).
Exports have declined, despite an increase in global economic activity. The construction industry is going through a deep crisis. The German economy is recovering only slowly, a fact that experts attribute largely to government policy.
With these and others, they refer in time to the development perspective in 2025.
The problems of the eurozone’s largest economy are multiplying at a time of domestic political weakness. The country has no coherent plan to restore its former economic strength.
Not only does this not bode well for Germany’s long-term economic prospects, but it will also make it difficult for the eurozone economy in general, and Italy and Spain in particular, to escape from the mountain of public debt.”
