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Real Incomes Increasing, Low-Income Rate Decreasing in Individual Age Groups

DIW Weekly Report 17/18 / 2020, S. 231-239

Markus M. Grabka, Jan Goebel

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The number of employed persons in Germany has grown by over five million since 2000, in part due to an increase in immigration. This development is reflected in private household income, which has increased by 12 percent over the same period. Since 2013, all income groups have been benefiting from this increase and in 2015, the lowest income decile began benefiting as well. Disposable income inequality and the low-income rate are stagnating, but the trends differ depending on migration background. In the native population, the low-income rate has not changed since 2008 and for some age groups, it has even declined. Over the course of the most recent wave of immigration, the rate increased significantly to around 30 percent for persons with a direct migration background, although the first effects of refugees’ integration into the labor market are just now being seen. Therefore, immigrants still require support integrating into the labor market.

Jan Goebel

Board of Directors SOEP and Division Head Data Operation and Research Data Center in the German Socio-Economic Panel study Department

Markus M. Grabka

Board of Directors SOEP & Acting Division Head in the German Socio-Economic Panel study Department

JEL-Classification: D31;I31;I32
Keywords: Income inequality, poverty, SOEP

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