a substantial cohort of low-wage earners, numbering 6..3 million in April 2025. The proportion of these low-wage jobs remains stagnant at 16 percent of total employment, mirroring the figure from the previous year and highlighting the limitations of recent policy interventions.
While there has been a reduction in the low-wage employment rate over the past decade, dropping from 21 percent in April 2014 to the current 16 percent, the most significant decline occurred between 2022 and 2023. This period coincided with increases to the statutory minimum wage, rising from €9.82 to €12.00. However, the data suggests that reliance on minimum wage adjustments alone is insufficient to meaningfully address systemic income inequality. The “low-wage threshold” defined as two-thirds of the median gross hourly wage excluding bonuses, stood at €14.32 in April 2025, up from €13.79 the prior year.
The distribution of low-wage employment is markedly uneven. The hospitality sector exhibits the most concerning figures, with over 51 percent of employment falling below the low-wage threshold. Agricultural, forestry and fishing also display disproportionately high rates (45 percent), as do the arts, entertainment and recreation industries (36 percent). Public administration, water, sewage and waste disposal, education and the finance and insurance sectors reflect more favorable conditions, with low-wage employment accounting for just 2-6 percent.
Crucially, the gap between high and low earners – the measure of wage dispersion – has remained largely unchanged between April 2024 and April 2025. This indicates that while some low earners have benefited from minimum wage increases, the overall upward mobility of the lowest income brackets has been limited, while earnings at the higher end of the spectrum have continued to outpace them.
In 2025, high earners earned 2.95 times the gross hourly wage of low earners. Although wages for the lowest 10 percent saw an increase of 3.5 percent and the median hourly wage rose by 3.9 percent, the gains for the top 10 percent – those classified as high earners – were comparatively modest, at just 1.5 percent. This raises questions about the efficacy of current policies in fostering genuine equitable growth and suggests a need for more targeted interventions to break cycles of low-wage employment and reduce the widening income disparity within the German economy. The relatively modest increase in earnings for the highest earners despite the overall positive economic climate and the slowing pace of income growth for those at the very bottom, warrants further investigation and targeted policy adjustments.