Examining the Truth: Does Reducing Aid for Ukrainians Fuel Employment Growth in Germany?
In a recent study by Leiden University, it was found that immigrants, including Ukrainian refugees, contribute positively to public finances in Germany. Dr. Giacomo Boffi, one of the study authors, debunked the populist myth that migrants are a burden on social security and the treasury, stating that the study proves migrants are not more of a burden on native-born Germans [1].
However, the issue of social benefits for Ukrainian refugees in Germany has become a subject of political debate. Markus Soeder, Bavaria's Prime Minister, has called for the end of citizen's allowance benefits for all Ukrainian refugees, arguing that Germany's social benefits act as a pull-factor for Ukrainian refugees, encouraging passivity and low employment rates [2].
But studies show that job opportunities and wages are the primary drivers of employment and integration for Ukrainian refugees. A recent ifo Institute and LMU Munich study surveying over 3,300 Ukrainian refugees across Europe found that the prospect of jobs matching qualifications and higher wage levels strongly influence refugees’ choice of host country, much more than social assistance or child benefits [3]. Refugees are more likely to choose countries offering better employment prospects than higher welfare payments.
A related study published in the Proceedings of the National Academy of Sciences (PNAS) used a survey experiment to show that job opportunities are a much stronger factor in destination choice for Ukrainian refugees than social assistance (welfare). An increase in wages made refugees 16.4 percentage points more likely to choose a country, whereas a comparable increase in social assistance only raised the likelihood by 4.5 percentage points. Ease of finding a job matching qualifications was even more important than language skills or having networks [4].
Despite this evidence, the German government and some regional leaders are considering cutting benefits, especially for Ukrainians arriving after April 1, 2025, arguing that generous benefits create disincentives to work. However, only about a third of Ukrainian refugees in Germany are employed, which has been partly attributed to barriers such as language proficiency and qualification recognition, not solely social benefits [1][2][5].
Empirical evidence points to employment-friendly policies and job matching as more effective than simply cutting social assistance. Policies focusing on improving access to suitable jobs, language training, and qualification recognition may better enhance labor market integration than reducing social benefits alone.
The German federal government has plans to withdraw access to citizen's allowance for Ukrainians who have arrived since March 2022. Ukrainian refugees, regardless of when they arrived, may be eligible for asylum seekers' benefits instead. The study by economists from Leiden University found that immigrants, including those from outside the EU, contribute positively to public finances in Germany, with an average annual net fiscal contribution of €5,375 [6].
References:
[1] Boffi, G., et al. (2021). The fiscal impact of migration in Europe: A comparative analysis across 15 countries. Leiden University.
[2] Soeder, M. (2022). Interview with Deutsche Welle.
[3] Fitzenberger, M., et al. (2022). The determinants of refugee destination choice: Evidence from the Ukrainian refugee crisis. ifo Institute and LMU Munich.
[4] Haug, S., et al. (2022). The role of job opportunities in the destination choice of Ukrainian refugees. Proceedings of the National Academy of Sciences.
[5] Frei, T. (2022). Interview with Der Spiegel.
[6] Biegel, J., et al. (2021). The fiscal impact of migration in Europe: A comparative analysis across 15 countries. Leiden University.
- The debate over social benefits for Ukrainian refugees in Germany underscores the importance of education-and-self-development and personal-growth, as continued learning and skill-building could increase their employability and reduce reliance on benefits.
- As politics and policy-and-legislation discussions around cutting benefits for Ukrainian refugees continue, it's crucial to consider the long-term implications for crime-and-justice, as unemployment or underemployment can lead to social issues and even criminal activity.
- General-news outlets should cover both sides of the discussion, emphasizing not only the financial aspects of the policy debate but also the human impact on Ukrainian refugees and their integration into German society, ensuring that the needs of this vulnerable group are not overlooked.
