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IW-Trends No. 1 23. May 2023 Matthias Diermeier/ Jan Felix Engler / Holger Schäfer Too Much or Too Little Reform?: Public Discussion of the Revised Unemployment Benefit

Under its new name, Citizens' Benefit (Bürgergeld), Germany’s reformed unemployment benefit was supposed to put basic benefits for job-seekers on a new footing and fulfil the political promise to "overcome" its controversial predecessor known, after its original sponsor’s final proposal, as ‘Hartz IV’.

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Public Discussion of the Revised Unemployment Benefit
IW-Trends No. 1 23. May 2023 Matthias Diermeier/ Jan Felix Engler / Holger Schäfer

Too Much or Too Little Reform?: Public Discussion of the Revised Unemployment Benefit

Matthias Diermeier/ Jan Felix Engler / Holger Schäfer German Economic Institute (IW) German Economic Institute (IW)

Under its new name, Citizens' Benefit (Bürgergeld), Germany’s reformed unemployment benefit was supposed to put basic benefits for job-seekers on a new footing and fulfil the political promise to "overcome" its controversial predecessor known, after its original sponsor’s final proposal, as ‘Hartz IV’.

However, the approach taken to key issues in draft legislation opened up various fault lines in society, in the coalition government and even among party supporters: the level of the standard benefits, the design of sanctions, the value of exempted assets and the appropriacy of housing costs. The eventual political compromise contained little of the originally promised reform. The survey of individuals conducted by the German Economic Institute (IW) throws light on both the disappointment among Green and (centre-left) SPD supporters at the limited scope of the reform and the dissatisfaction of supporters of the liberal FDP with the easing of eligibility conditions. Indeed, on key issues, the latter party was only surpassed by the right-wing AfD supporters in their criticism of the extent of the reform. In the end, only among Green and SPD supporters were there majorities in favour of the changes, and overall public approval of the new benefits remains extremely modest at around one-third. An additional analysis of posts on the social networking service Twitter reveals lively criticism of the Citizens' Benefit online. The most intense discussion concerned the potential negative impact of a higher level of benefit on incentives to work. While FDP politicians were restrained in their remarks, the welfare-chauvinist tweets from the ranks of the AfD found a considerable echo – though the party was unable to spark a wider discussion on the issue of migration.

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Public Discussion of the Revised Unemployment Benefit
IW-Trends No. 1 23. May 2023 Matthias Diermeier/ Jan Felix Engler / Holger Schäfer

Too Much or Too Little Reform?: Public Discussion of the Revised Unemployment Benefit

Matthias Diermeier/ Jan Felix Engler / Holger Schäfer German Economic Institute (IW) German Economic Institute (IW)

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Älterer Mann arbeitet in seinem Fahrradladen.
IW-Report No. 29 19. June 2026 Ruth Maria Schüler / Stefanie Seele

Abolition of the Additional Earnings Limit

The ageing population in Germany is increasing pressure on the social insurance systems and will (in the future) exacerbate the shortage of skilled labour.

Ruth Maria Schüler / Stefanie Seele IW

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IW-Trends No. 1 19. May 2026 Wido Geis-Thöne / Andrea Hammermann / Ruth Maria Schüler

Is Lifelong Learning the Key to Later Retirement?

There appears to be a connection between lifelong learning and remaining longer active in the labour market.

Wido Geis-Thöne / Andrea Hammermann / Ruth Maria Schüler IW

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