The countdown to the farewell is on, only a few days remain until the citizen’s income replaces Hartz IV at the turn of the year. The legislative decision at the end of November came just in time, so that the higher standard rate – 502 instead of the previous 449 euros for single people – can actually be paid out on January 1st. “We are glad that this is happening on time,” says Anette Farrenkopf, managing director of the Munich job center.
Anyone who is already receiving benefits, such as around 39,600 Munich households with 52,300 employable persons and 22,300 children and young people, does not need to submit a new application, but will automatically receive the higher standard rates. In view of the special situation in Munich with living costs that are more expensive than elsewhere, the increase and the future faster adjustment to compensate for inflation are important, emphasizes Anette Farrenkopf.
The head of the job center is relieved that the main part of the reform will not come into force until July 1, 2023, leaving more time for preparation. The job center is also happy that the job center will only request reimbursements, for example in the event of minor changes in monthly income, if the new minimum limit of 50 euros is exceeded.
Because in the past three years, the employees of the job center, which has 940 full-time jobs from the employment agency and the city, have had a lot to do anyway. Coping with the corona pandemic and the consequences of the lockdown caused the number of people who needed state support to rise sharply in 2020 and 2021 (see chart). The easing that began in mid-2021 ended in June of this year when the refugees from Ukraine were accepted into the basic security for job seekers.
Around 7,500 over the age of 15 have been registered so far, around 3,000 are taking part in language and integration courses, and another 1,000 will start courses in the next four to six weeks. And a good 500 refugees who were registered as unemployed have already been placed in work since June. The fact that there are too few integration courses with childcare is proving to be an obstacle – almost 75 percent of the refugees from Ukraine who are registered as unemployed are women.
The expert believes that dips in orders should not immediately affect the job market
On the other hand, the job center manager is less concerned about the Munich labor market: “He has recovered greatly from Corona and has developed well.” And in view of the enormous need for skilled workers, which is troubling many companies, Anette Farrenkopf is confident that dips in orders at companies as a result of inflation and the energy crisis will not have the same effect, i.e. will not lead to downsizing. However, the head of the job center expects that more people will need additional help because their income is no longer sufficient to cover their living expenses as a result of inflation and increased energy costs.
It would not have been possible to manage the complete conversion to citizen income on January 1st, after the Bundestag and Bundesrat only reached an agreement at the end of November. The notices with the old terms remain valid for six months. “Basic security for jobseekers”, “benefits according to the Social Security Code II” or “unemployment benefit II” – these terms have never really caught on in public, since “Hartz IV” was much more catchy. Farrenkopf is convinced that the new name “Bürgergeld” will also help to overcome the “Hartz IV stigma”. Because the new law strengthens the “dealing at eye level” with the customers of the job center. In future, the notifications should also be drafted in a way that is easier to understand.
More money for people who need it – the new regulation will ensure that.
(Photo: Monika Skolimowska/dpa)
For those affected in Munich in particular, the one-year waiting period, during which the actual costs of accommodation are borne in full by the job center, should be an important relief. This should enable people to concentrate on looking for a job instead of having to look for a cheaper apartment, explains Anette Farrenkopf. In the future, single people will not have to use their savings of 40,000 euros during this waiting period, and a further 15,000 euros will be added for each household member.
For the long-term unemployed in particular, who are no longer able to gain a foothold in the primary job market, the phasing out of support for employment in the social job market, which was previously limited to five years, could be helpful. Farrenkopf welcomes the fact that “from July 1st, the focus will be completely different on qualification and further training” than before. This is of particular importance for Munich: Almost two thirds of the jobseekers registered in the job center have not completed vocational training, on the other hand the shortage of skilled workers is particularly great in the state capital.
An incentive is provided for successful professional qualifications
The job center could set “good accents”, announced Farrenkopf, especially since there is no priority for mediation in jobs. In the past, retraining shortened to two years was only possible, but three years are possible in the future. Farrenkopf expects better opportunities from this, especially for migrants, who often couldn’t manage the shortened training because of language problems. In addition, there is an incentive for a qualification-oriented training, for which there is a further training allowance of 150 euros in addition to the standard rate. Ultimately, it pays off, because professional qualifications are more likely to lead to permanent employment than volunteer work.
In order to be able to offer funding, however, a corresponding budget is also necessary. “We were sufficiently equipped for 2022,” says Farrenkopf. “And for 2023, we’re where we were at 2022.” However, there are enormous cost increases, for example due to tariff increases and heating costs, also for service providers.
“The best thing is the sanction I don’t have to pronounce”
The fact that there was a bitter public debate about sanctions due to a lack of cooperation by benefit recipients does not correspond to the importance of the topic in the Munich job center, where the rate was below average. Just 0.9 percent of employable benefit recipients were sanctioned in December 2021. “The best thing is the sanction that I don’t have to pronounce,” says Anette Farrenkopf. “We’ve always gone down the right path. We’ve had good experiences with outreach work, accompanying coaching and activation to bring people back to a regular life.” The new, graduated and more restrained sanctioning regulation will therefore not be needed for many people.