Recipients of unemployment benefit II in Germany can look forward to a little more money in their wallets from 2021, according to the latest calculations from the Federal Ministry of Labour. 

Unemployment benefit II rates to rise next year

Hartz IV rates will increase more strongly on January 1, 2021 than previously anticipated. This was reported by the Redaktionsnetzwerk Deutschland (RND), citing Labour Ministry figures. 

Accordingly, from January 1, 2021, single adults will receive 446 euros per month, an increase of 14 euros per month. The rate for young people between the ages of 14 and 17 will increase by 45 euros to 373 euros per month, and for children up to the age of five the benefit will be 283 euros a month, instead of 250 euros as previously. 

Hartz IV benefits increase every year to match prices and salaries

According to the report, the increase is driven by rising prices and salaries. The benefit rates are set every five years, when the new so-called income and expenditure sample (EVS) is made available. They are also updated annually in line with wage and price developments. These new increases now need to be approved by the Bundetag and the Bundesrat, with the law expected to come into force on January 1, 2021. 

According to the Federal Employment Agency, around 5,7 million people in Germany receive unemployment benefit II. The nickname “Hartz IV” refers back to the social reforms made under Chancellor Gerhard Schröder, based on suggestions by the former VW manager Peter Hartz.