Unemployment Benefits in Germany: Bürgergeld, Arbeitslosengeld and Other Payments

What counts as unemployment in Germany?

In everyday speech, we call someone "unemployed" if they do not have a job or have lost their job. However, in Germany, you are officially considered unemployed only if you meet certain conditions, including registering with the employment agency.

In Germany, a person is considered unemployed if they do not have a job, are actively looking for work, and are ready to start working. These rules are set out in the unemployment insurance law ¹.

To get official unemployed status and the main benefit, you must meet several requirements:

• Not have a job or work less than 15 hours per week;
• Be ready to start work and actively look for a job;
• Register with the Agentur für Arbeit as both looking for work (Arbeitssuchend) and as unemployed (Arbeitslos).

After registering, you can get advice, job offers, training programmes and, if you qualify, financial support ².

Main Benefits for Unemployed People

There are several types of financial support in Germany for people who have lost their jobs. The main payments come from two state systems: unemployment insurance and basic social security. Both are part of Germany’s social system. So, the main benefits for unemployed people are: Arbeitslosengeld (also called ALG) and Bürgergeld.

Arbeitslosengeld (unemployment benefit) is an insurance payment for people who have worked before and paid into the unemployment insurance system. It is paid for a limited time and depends on your previous earnings.

Bürgergeld (basic social security) is basic support for people who do not have enough income or do not qualify for unemployment insurance. This payment is meant to guarantee a minimum standard of living.

These two types of support are managed by different offices:

• Agentur für Arbeit – responsible for the insurance benefit Arbeitslosengeld;
• Jobcenter – responsible for Bürgergeld payments.

Besides the main benefits, there are other support programmes for unemployed people – for example, help with training, retraining, starting a job or opening your own business. These measures help people return to work more quickly.

Benefits Table: Types of Support for Unemployed People

If you lose your job in Germany, there are several types of financial support and help programmes. They differ in eligibility rules, payment amounts and how long you can receive them. Besides money, the German system also includes training, retraining and help with starting a business.

Table 1: Types of Financial Support for Unemployed People in Germany

Arbeitslosengeld: Eligibility, Payment Amounts and Duration

Arbeitslosengeld (previously called Arbeitslosengeld I) is an unemployment insurance benefit in Germany. It is paid to people who have worked before and paid into the unemployment insurance system (Arbeitslosenversicherung). If you want to know more about salary deductions in Germany, see this link.

The benefit is paid by the Agentur für Arbeit (Federal Employment Agency). The aim is to temporarily replace lost income while you look for a new job.

Eligibility Criteria

You usually qualify for Arbeitslosengeld if you meet these conditions:

• You do not have a job or work less than 15 hours per week;
• You have registered as looking for work and as unemployed with the Agentur für Arbeit;
• You have submitted the completed form and copies of required documents to the employment office;
• You are actively looking for work and ready to start a new job;
• You have worked at least 12 months with social insurance contributions (Versicherungspflichtige Beschäftigung) in the last 30 months.

Payment Amounts

The amount of ALG depends on your previous income (salary before tax/deductions) before you became unemployed, your tax class and whether you have children. The typical benefit rates are:

• 60% of your net salary – if you do not have children;
• 67% of your net salary – if you have children.

While receiving ALG, you remain insured in the state pension scheme, statutory health insurance and long-term care insurance.

If you do not find a job after your Arbeitslosengeld payments end and your income is still too low, you can apply for Bürgergeld, and receive basic support from the state.

How Long Is It Paid?

The length of time you can get ALG depends on your age and how long you worked before. In most cases, it is paid for 6 to 12 months. For older people with long insurance histories it can last up to 24 months.

Table 2: Duration of Unemployment Benefit Payments in Germany by Age and Work History

The longer you worked and paid contributions, the longer you can receive unemployment benefit.

Earning Extra Money While Receiving Unemployment Benefit

If you get Arbeitslosengeld, you can work part-time. However, there are limits on working hours and how extra income is counted.

The main rule: You are only considered unemployed if you work less than 15 hours per week. If you work more than 15 hours per week, you lose unemployment status and payments stop.

If you earn up to €165 per month, this does not affect your benefit. If your earnings are higher than €165, first your work-related costs (for example travel costs) are deducted. The rest is subtracted from your benefit. The calculation only uses your net income after taxes and compulsory contributions.

You must inform the Agentur für Arbeit about any part-time work in advance. The agency must know about all paid activities, even small jobs.