How much does an unemployed person cost

Nuremberg (dpa) - Each unemployed person cost an average of 19,600 euros in 2014. The per capita burden for social security and taxpayers was around 600 euros higher than in 2013, despite the slight decrease in unemployment.

This is the result of a study published on the Internet on Wednesday by the Institute for Employment Research (IAB). Of the 19,600 euros, around 8,100 euros were accounted for by unemployment benefits and social benefits, the remainder on lost tax revenue and social contributions, since the unemployed paid no wage tax and hardly any social contributions.

According to the calculations of the labor market researchers, the costs of unemployment added up to 56.7 billion euros in 2014; this is 0.7 billion euros or 1.3 percent more than in the previous year. In a long-term comparison, expenses including lost taxes and insurance premiums were at a similar level. In 2005, however, the costs were a good 30 billion euros higher.

IAB labor market researcher Enzo Weber justifies the increased costs primarily with higher wages. On the one hand, this led to higher unemployment benefits. "Because whoever earns more pays higher unemployment insurance contributions and, if he loses his job, also receives higher unemployment benefits," Weber pointed out. At the same time, if a previously employed person was unemployed, the state and social security funds would lose more taxes and contributions than in previous years.

Measured against the increased gross domestic product, the share of the cost of unemployment fell from 1.99 to 1.94 percent in 2014 compared to the previous year, Weber emphasized. According to the study, spending by the federal agency and government on programs for so-called active labor market policy has shrunk sharply in recent years. At 10.3 billion euros in 2014, the amount earmarked for courses and training for the unemployed has halved since the 2009 recession.