Ruhr Economic Papers #122 Ruhr Economic Papers Nickel and Dimed German Style: the Working Poor in Germany

Using data from the German SOEP, this paper analyses whether there have been (a) any significant changes in poverty rates and poverty intensities before and after the Hartz IV reforms and (b) whether there have been observable changes in the effect of employment in reducing the threat or intensity of poverty. Using multivariate analyses we can find no evidence of increases in poverty rates comparing the time period 2002–2004 with that of 2005–2006. Further we find no change in the effect of employment in reducing the probability and intensity of poverty during this time period. The “working poor” phenomenon in Germany remains relatively small and statistically unchanged by the Hartz reforms. JEL Classification: D31, J65, J21