Economy and Social Matters

„The Sudden Descent“ – What it Means to be Unemployed

Over five million people in Germany are out of work. Though numbers and statistics make a clear statement, they say little about what being unemployed means for the individual.

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Author: Per Schnell
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Family breadwinner Bernd Brück has been looking for work for over fifteen months. Peter Kleimeier, once the successful manager of a major service providing company, knew what it meant to be on top. He couldn’t have imagined that he’d fail to find a new job. His professional decline was accompanied by serious depression.

The film describes the situation of two very different protagonists, both affected by the current mass unemployment trend. Bernd Brück was the branch manager of a financial institution. At 40 he had already reached the top rung on the professional ladder. He resigned of his own free will, thinking that with his capabilities he’d soon find a new and better position. His was mistaken: In rural areas especially, the job market has little demand for qualified professionals. Peter Kleimeier, top manager in a large service providing organisation, had also gravely misjudged his labour market position; like many other highly qualified white-collar workers and managers, he was left with no choice but to start up his own business.

On January 1st, 2005 the unemployment policy reform program known as Hartz IV came into effect. It brings with it a major restructuring of the basic subsistence guarantee for those seeking work, the central element of which is the fusion of the two former categories “unemployment assistance” and “social assistance” into a single payment type known as “unemployment benefit II”. The result is a two-tier benefit system: First, unemployment assistance, and in the event of prolonged unemployment, the downgrading to unemployment benefit II (Hartz IV). All job seekers between the ages of 15-65 capable of working and in need of financial assistance, as well their dependants, are legally entitled to subsistence-level benefit payments.

Considered capable of work are all those who would be able to work for at least three hours at a stretch under the standard occupational conditions on the general labour market. The subsistence guarantee is meant to provide not only financial assistance but practical support as well. For the job seekers themselves, this financial assistance is called “unemployment benefit II” and for their dependants “social benefit”. The goal is for people capable of work and in need of assistance to be better and more quickly looked after, so that they can soon be earning their own living again, at least in part. Personal “case managers” encourage the unemployed receiving benefit to overcome “obstacles to placement” and negotiate a six-month ‘re-integration’ agreement with them. Re-integration measures can include training programmes as well as, for example, the financing of a driving license qualification – a costly undertaking in Germany - or the purchase of special work clothes or uniforms.

The goal of Hartz IV is to insure that those on benefit who nevertheless have some form of gainful employment – even a so-called “mini-job” – have more cash in hand then those who take no initiative on their own behalf. In future, the additional income will be deducted in full from the “unemployment benefit II” payment only when net earnings reach levels of over € 1,500 -. Important: As part of the labour market reform programme, the unemployed individuals must take more responsibility for their own progress and will be held to account more stringently than to date. Those who refuse employment, training or a re-integration measure deemed ‘reasonable’ by officially approved standards, as well as those who fail to show self-motivation in their job search, will find their monthly benefit payments cut by around 100,- € for a three-month period. Young people under the age of 25 who refuse a ‘reasonable’ job offer, vocational training or participation re-integration programme will receive no cash payment for a three-month period. Lodging and heating costs will not be docked, but will be paid directly to the landlord/lady, power co., etc. only.

A job placement may not be refused by the unemployed person on any of the following grounds:
  • Because the work is not commensurate with one’s former profession or professional training.
  • Because the workplace is located farther away than one’s former place of employment.
  • Because the work conditions or benefits are less attractive than in one’s former occupation.
  • A lower salary than one’s former earnings is also an unacceptable ground for employment refusal.
Those not capable of employment and financially dependant on those on benefit who are capable of employment receive “social benefit”. If the recipient of unemployment benefit possesses capital, this can result in a diminished benefit payment depending on the level of personal wealth.
Goethe-Institut e. V. 2005
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