Skip to content
Licensed Unlicensed Requires Authentication Published by De Gruyter Oldenbourg April 20, 2022

The Untold Story of Midijobs

  • Anna Herget and Regina T. Riphahn EMAIL logo

Abstract

Midijobs are employment relationships with moderate monthly earnings that benefit from payroll tax subsidies. Since 2003, the subsidy is universally available for all regions, industries, individuals, and employers in Germany. Recently, more than 2.9 million individuals, i.e., almost 9 percent of the German labor force covered by the social security system took advantage of Midijobs. This paper describes the program, its motivation, and utilization over time. We characterize the labor market transitions leading into and out of Midijob employment, the duration of Midijob utilization, and compare recent developments with patterns of program utilization that were observed early on.

JEL Classification: J21; J38; H24

Corresponding author: Regina T. Riphahn, Friedrich-Alexander-University Erlangen-Nürnberg, Lange Gasse 20, 90403 Nürnberg, Germany, E-mail:

Award Identifier / Grant number: RI 856/10-1

  1. Research funding: We thank two anonymous referees and Matthias Collischon for helpful comments and the German Research Foundation (DFG) for funding project RI 856/10-1.

Institutional Appendix

  1. Retirement insurance contributions for Mini- and Midijobbers

Minijobs: Minijob employees do not have to contribute to social insurances. However, since 1999 individuals have the option to forgo the exemption from retirement insurance contributions (opt in). If Minijob employees contribute to the retirement insurance (the contribution rate is 3.6 percent of gross earnings), they can accumulate claims against the insurance in terms of contribution periods and contribution amounts. Only a very small share of Minijob employees used this option. Starting January 1, 2013 regulations were changed. Since then, the default is that workers are required to contribute to the retirement insurance. However, they can easily opt out of the requirement by notifying their employer.

Midijobs: Midijob employees pay social insurance contributions, however at a reduced rate. The subsidy consists of artificial deductions from their gross earnings prior to applying the standard social insurance contribution rates. The deduction amount declines as earnings increase from the Minijob earnings ceiling towards the Midijob earnings ceiling. Since Midijobs were introduced individuals had the option to forgo the subsidy on their contributions to retirement insurance and thus to pay retirement insurance contributions on their full earnings instead. The option was changed with the 2019 reform: since July 2019 the retirement insurance automatically credits workers with contributions on their full earnings even though they pay only the subsidized amount.

  1. Combination of different employment relationships

Minijobs: Workers can hold Minijobs as their main employment or as an add-on employment. If one or more Minijobs are held as main employment then the sum of earnings cannot exceed the Minijob earnings limit without losing the Minijob benefit. If the earnings from one employment exceed the Minijob earnings limit the job qualifies as a Midijob. If the earnings limit exceeds the monthly Midijob earnings limit the job is a regular, unsubsidized job.

Midijob: Workers are allowed to hold one Minijob in addition to a Midijob. If more than one Midijob is held the worker can no longer claim the Midijob subsidy. Since the 2019 reform more than one Midijob can be held as long as the total earnings are below the 1,300 Euro threshold.

Individuals in training or apprenticeships cannot benefit from the Midijob regulation for their training or apprenticeship earnings even if the monthly earnings are within the Midijob earnings range.

  1. Administrative treatment of Midijobs

Employers register their workers with social insurances and handle the transfer of contribution payments. When they notify a new or continuing employment relationship (annual notification) employers inform the unemployment insurance about the Midijob status of the worker using an indicator. The Midijob indicator can take on three different values:

  • Value 0: Subsidy is not applicable or individual chooses to forgo the subsidy for the retirement insurance (the latter information was relevant 2003–2019). Midijob employments with value 0 are not considered in the aggregate statistics on Midijob employment because it is not certain that the Midijob subsidy is applied (e.g., if several employment relationships are held at the same time).

  • Value 1: Subsidy is calculated, individual earns within in the subsidized Midijob earnings range.

  • Value 2: Subsidy is calculated, individual employment includes periods with earnings outside of the Midijob earnings range, i.e., below the Minijob earnings ceiling, within the Midijob earnings range, and/or above the Midijob earnings ceiling. Here average earnings over the entire period are used to calculate appropriate contributions (Mischfälle).

Appendix

Table A.1:

Descriptive Statistics

Variable N Mean Std. Dev. Min Max
Female 300,539 0.616 0.486 0 1
Age 17–24 (reference) 300,539 0.217 0.412 0 1
Age 25–34 300,539 0.298 0.457 0 1
Age 35–44 300,539 0.204 0.403 0 1
Age 45–54 300,539 0.170 0.376 0 1
Age 55–64 300,539 0.093 0.291 0 1
Age 65+ 300,539 0.018 0.132 0 1
Educ: No voc Train (reference) 300,539 0.405 0.490 0 1
Educ: Voc Train 300,539 0.512 0.499 0 1
Educ: Academic 300,539 0.083 0.276 0 1
Foreign 300,539 0.193 0.395 0 1
East 300,539 0.218 0.413 0 1
Occ: Agricultural (reference) 300,539 0.022 0.147 0 1
Occ: Simple manual 300,539 0.092 0.289 0 1
Occ: Qualified manual 300,539 0.079 0.270 0 1
Occ: Technician/Engineer 300,539 0.023 0.149 0 1
Occ: Simple services 300,539 0.276 0.447 0 1
Occ: Qualified services 300,539 0.069 0.253 0 1
Occ: Semiprofessional 300,539 0.071 0.257 0 1
Occ: Professional 300,539 0.026 0.160 0 1
Occ: Simple clerk and admin. 300,539 0.155 0.362 0 1
Occ: Qualified clerk and admin. 300,539 0.128 0.334 0 1
Occ: Manager 300,539 0.011 0.105 0 1
Occ: Other 300,539 0.047 0.212 0 1
Firm size 0–19 (reference) 300,539 0.356 0.479 0 1
Firm size 20–99 300,539 0.248 0.432 0 1
Firm size 100–199 300,539 0.105 0.307 0 1
Firm size 200–299 300,539 0.053 0.224 0 1
Firm size 300+ 300,539 0.188 0.390 0 1
Ind: Agriculture & Mining (ref.) 300,539 0.024 0.152 0 1
Ind: Food Drink Tobacco 300,539 0.017 0.131 0 1
Ind: Cons. Goods Production 300,539 0.012 0.108 0 1
Ind: Ind. Goods Production 300,539 0.023 0.149 0 1
Ind: Capital Goods Production 300,539 0.028 0.165 0 1
Ind: Construction 300,539 0.037 0.188 0 1
Ind: Trade Service Hotels Rest. 300,539 0.297 0.457 0 1
Ind: Logistics & Financ. Services 300,539 0.307 0.461 0 1
Ind: Educ. Health Publ. Admin. 300,539 0.197 0.397 0 1
Ind: Other 300,539 0.059 0.235 0 1
  1. Source: Own calculations based on SIAB, 1975–2017.

References

Anderson, Patricia M. and Meyer, Bruce D. (1997). The effects of firm specific taxes and government mandates with an application to the U.S. unemployment insurance program. J. Publ. Econ. 65: 119–145, https://doi.org/10.1016/s0047-2727(96)01624-6.Search in Google Scholar

Anderson, Patricia M. and Meyer, Bruce D. (2000). The effects of the unemployment insurance payroll tax on wages, employment, claims and denials. J. Publ. Econ. 78: 81–106, https://doi.org/10.1016/s0047-2727(99)00112-7.Search in Google Scholar

Antoni, Manfred, Alexandra, Schmucker, Seth, Stefan, and Berge, Philipp vom (2019). Sample of integrated labour market biographies (siab) 1975 – 2017. Nuremberg: Institute for Employment Research, FDZ-Datenreport 02/2019. http://doku.iab.de/fdz/reporte/2019/DR_02-19.pdf.Search in Google Scholar

BA (Bundesagentur für Arbeit) (2010). Methodenbericht – Kurzfristige Beschäftigung. Nürnberg: Bundesagentur für Arbeit, https://statistik.arbeitsagentur.de/DE/Statischer-Content/Grundlagen/Methodik-Qualitaet/Methodenberichte/Beschaeftigungsstatistik/Generische-Publikationen/Methodenbericht-Kurzfristige-Beschaeftigung.pdf?__ blob=publicationFile&v=5 (Last access 01 Sept 2020).Search in Google Scholar

BA (Bundesagentur für Arbeit) (2013). Statistik der Bundesagentur für Arbeit. Tabellen, Betriebe und sozialversicherungspflichtige Beschäftigung, Nürnberg, 30, Juni 2013.Search in Google Scholar

BA (Bundesagentur für Arbeit) (2014). Sozialversicherungspflichtig und geringfügig Beschäftigte sowie Auszubildende nach Berufsordnungen (3-Steller) der KldB 1988, sowie Geschlecht und Nationalität in Deutschland ab dem Stichtag 30.06.2001 bis 30.06.2011 (Quartalsdaten), Nürnberg, Datenstand November 2014, retrieved from: Einzelausgaben – Statistik der Bundesagentur für Arbeit (arbeitsagentur.de) [May 31, 2020].Search in Google Scholar

BA (Bundesagentur für Arbeit) (2020a). Länderreport über Beschäftigte (Quartalszahlen) Deutschland Stichtag 31.12.2019, Nürnberg, retrieved from https://statistik.arbeitsagentur.de/SiteGlobals/Forms/Suche/Einzelheftsuche_Formular.html?topic_f=beschaeftigung-sozbe-qheft (19 August 2020).Search in Google Scholar

BA (Bundesagentur für Arbeit) (2020b). Beschäftigte nach ausgewählten Merkmalen (Zeitreihe Quartalszahlen), Nürnberg, retrieved from https://statistik.arbeitsagentur.de/Statistikdaten/Detail/Aktuell/iiia6/beschaeftigung-sozbe-zr-ausgewmerkmale-altersgr/zr-ausgewmerkmale-altersgr-d-0-xlsx.xlsx?__blob=publicationFile&v=1 (1 September 2020).Search in Google Scholar

BA (Bundesagentur für Arbeit) (2021). Dauer von Beschäftigung (Jahreszahlen), retrieved from https://statistik.arbeitsagentur.de/Statistikdaten/Detail/202012/iiia6/beschaeftigung-sozbe-dauern/dauern-d-0-202012-xlsx.xlsx?__blob=publicationFile&v=1 (2 November 2021).Search in Google Scholar

Bach, Stefan, Hermann, Buslei, and Harnisch, Michelle (2018). Midijob-Reform entlastet Geringverdienende, vor allem teilzeiterwerbstätige Frauen. DIW aktuell Nr 16, Berlin: DIW Berlin, 28. August 2018.Search in Google Scholar

Bennmarker, Helge, Mellander, Erik, and Öckert, Björn (2009). Do regional payroll tax reductions boost employment? Lab. Econ. 16: 480–489, https://doi.org/10.1016/j.labeco.2009.04.003.Search in Google Scholar

Berthold, Norbert and Coban, Mustafa (2013a). Ordnungspolitische Beurteilung geringfügig entlohnter Beschäftigung (Minijobs). In: mimeo, Würzburg: Univ. Würzburg.Search in Google Scholar

Berthold, Norbert and Coban, Mustafa (2013b). Mini- und Midijobs in Deutschland: Lohnsubventionierung ohne Beschäftigungseffekte? Ordo – Jahrb. Ordn. Wirtsch. Ges. 64: 289–323, https://doi.org/10.1515/9783828260207-014.Search in Google Scholar

Bingley, Paul and Lanot, Gauthier (2002). The incidence of income tax on wages and labour supply. J. Publ. Econ. 83: 173–194, https://doi.org/10.1016/s0047-2727(01)00080-9.Search in Google Scholar

Brandt, T. (2005). Mini- und Midijobs im Kontext aktivierender Arbeitsmarkt- und Sozialpolitik: Konsequenzen für Arbeitnehmerrechte, den Arbeitsmarkt und den Zusammenhang von Wohlfahrt und Beschäftigung. WSI Diskussionspapier No. 142, Düsseldorf: Wirtschafts- und Sozialwissenschaftliches Institut in der Hans-Böckler-Stiftung.Search in Google Scholar

Brandt, T. (2006). Bilanz der Minijobs und Reformperspektiven. WSI-Mitteilungen 8: 446–452.Search in Google Scholar

Bundesrat (2002). Plenarprotokoll 784, Stenographischer Bericht 784. Sitzung, 20, Dezember 2002 https://dserver.bundestag.de/brp/784.pdf (last access 25 October 2021).Search in Google Scholar

Bundestag (2018). Drucksache 19/05236 Kleine Anfrage der Abgeordneten Susanne Ferschl u.a. und der Fraktion DIE LINKE betreffend. In: Midijobs und die Auswirkungen ihrer geplanten Ausweitung, Berlin: Deutscher Bundestag.Search in Google Scholar

Bundestag (2021). Drucksache 19/32219 Antwort der Bundesregierung auf die Kleine Anfrage der Abgeordneten Susanne Ferschl, Matthias W. Birkwald, Sylvia Gabelmann, weiterer Abgeordneter und der Fraktion DIE LINKE.– Drucksache 19/31982, Berlin: Midijobs in Deutschland.Search in Google Scholar

Collischon, Matthias, Cygan-Rehm, Kamila, and Riphahn, Regina T. (2021). Long-run effects of wage subsidies on maternal labor market outcomes. LASER Discussion Paper No. 378, Nürnberg: University of Erlangen-Nürnberg.Search in Google Scholar

Collischon, Matthias, Cygan-Rehm, Kamila, and Riphahn, Regina T. (2021). Employment effects of payroll tax subsidies. Small Bus. Econ. 57: 1201–1219, https://doi.org/10.1007/s11187-020-00344-w.Search in Google Scholar

Dauth, Wolfgang and Eppelsheimer, Johann (2020). Preparing the sample of integrated labour market biographies (SIAB) for scientific analysis: a guide. J. Lab. Market Res. 54: 9–23, https://doi.org/10.1186/s12651-020-00275-9.Search in Google Scholar

Destatis (2019). Statistisches Jahrbuch Deutschland 2019. Wiesbaden: Statistisches Bundesamt.Search in Google Scholar

DRV (Deutsche Rentenversicherung Bund) (2018). Rentenversicherung in Zeitreihen. Berlin: Ausgabe 2018.Search in Google Scholar

Dundler, Agnes, Frank, Thomas, and Grimm, Christopher (2019). Grundlagen: Methodenbericht – Beschäftigte mit geringen Entgelten. Nürnberg: Bundesagentur für Arbeit.Search in Google Scholar

Fertig, Michael and Kluve, Jochen (2006). Alternative Beschäftigungsformen in Deutschland: Effekte der Neuregelung von Zeitarbeit, Minijobs und Midijobs. Vierteljahreshefte zur Wirtschaftsforschung 75: 97–117, https://doi.org/10.3790/vjh.75.3.97.Search in Google Scholar

Fichtl, Anita (2015). Mini- and Midi-Jobs in Germany – Effects of marginal employment on unemployment, Vol. 3. Stockholm: FORES, Stockholm. FORES Policy Paper 2015.Search in Google Scholar

Garsaa, Aziza and Levratto, Nadine (2015). Do labor tax rebates facilitate firm growth? An empirical study on French establishments in the manufacturing industry, 2004–2011. Small Bus. Econ. 45: 613–641, https://doi.org/10.1007/s11187-015-9653-1.Search in Google Scholar

Gruber, Jonathan (1997). The incidence of payroll taxation: evidence from Chile. J. Labor Econ. 15: S72–S101, https://doi.org/10.1086/209877.Search in Google Scholar

Gruhl, Anja, Alexandra Schmucker, and Seth, Stefan (2012). Das Betriebs-Historik-panel 1975–2010. FDZ-datenreport 04/2012. Nürnberg, Germany: IAB Nürnberg.Search in Google Scholar

Gudgeon, Matthew and Trenkle, Simon (2020). The Speed of earnings Responses to Taxation and the Role of firm labor demand, IZA discussion paper No. 13931. Bonn, Germany: Institute of Labor Economics.10.2139/ssrn.3747449Search in Google Scholar

Haywood, Luke and Neumann, Michael (2017). The role of aggregate preferences for labor supply – evidence from low-paid employment, DIW Discussion Paper No. 1652. Berlin.10.2139/ssrn.2941301Search in Google Scholar

Herzog-Stein, Alexander and Sesselmeier, Werner (2012). Alternativen zu Mini- und Midijobs? Die Beispiele Frankreich und Vereinigtes Königreich. WSI Mitteilungen 2012-01: 41–49, https://doi.org/10.5771/0342-300x-2012-1-41.Search in Google Scholar

Huttunen, Kristiina, Pirttilä, Jukka, and Uusitalo, Roope (2013). The employment effects of low-wage subsidies. J. Publ. Econ. 97: 49–60, https://doi.org/10.1016/j.jpubeco.2012.09.007.Search in Google Scholar

Kangasharju, Aki (2007). Do wage subsidies increase employment in subsidized firms? Economica 74: 51–67, https://doi.org/10.1111/j.1468-0335.2006.00525.x.Search in Google Scholar

Keller, Berndt and Seifert, Hartmut (2015). Atypical forms of employment in the public sector – are there any? WSI-Diskussionspapier No. 199. Düsseldorf: Wirtschafts- und Sozialwissenschaftliches Institut in der Hans-Böckler-Stiftung.10.2139/ssrn.2647957Search in Google Scholar

Keller, Berndt, Pusch, Toralf, and Seifert, Hartmut (2021). Midijobs: Die unbekannte Variante der atypischen Beschäftigung. WSI Mitteilungen 14: 160–170, https://doi.org/10.5771/0342-300X-2021-2-160.Search in Google Scholar

Korkeamäki, Ossi and Uusitalo, Roope (2009). Employment and wage effects of a payroll-tax cut – evidence from a regional experiment. Int. Tax Publ. Finance 16: 753–772.10.1007/s10797-008-9088-6Search in Google Scholar

Saez, E., Schoefer, B., and David Seim (2019). Payroll taxes, firm behavior, and rent sharing: evidence from a young workers’ tax cut in Sweden. Am. Econ. Rev. 109: 1717–1763, https://doi.org/10.1257/aer.20171937.Search in Google Scholar

Seifert, Hartmut (2017). Wie lassen sich Entwicklung und Strukturen atypischer Beschäftigungsverhältnisse erklären? WSI-Mitteilungen 2017-01: 5–15, https://doi.org/10.5771/0342-300x-2017-1-5.Search in Google Scholar

SSA (Social Security Administration) (2018). Social security programs Throughout the World: Europe, 2018. SSA Publication No. 13-11801, Washington, DC: Social Security Administration.Search in Google Scholar

SVR (Sachverständigenrat zur Begutachtung der gesamtwirtschaftlichen Entwicklung) (2006). Arbeitslosengeld II revidieren: Ein zielgerichtetes Kombilohnmodell. August, Wiesbaden: Expertise im Auftrag des Bundesministers für Wirtschaft und Technologie.Search in Google Scholar

Tazhitdinova, Alisa (2020). Do only tax incentives matter? Labor supply and demand responses to an unusually large and salient tax break. J. Publ. Econ. 184, https://doi.org/10.1016/j.jpubeco.2020.104162.Search in Google Scholar

Thomsen, Ulrich, Ludsteck, Johannes, and Alexandra, Schmucker (2018). Skilled or unskilled – Improving the information on qualification for employee data in the IAB Employee Biography. FDZ-Methodenreport, 09/2018, Nürnberg: IAB Nürnberg.Search in Google Scholar

Received: 2021-07-15
Accepted: 2022-02-27
Published Online: 2022-04-20
Published in Print: 2022-06-27

© 2022 Walter de Gruyter GmbH, Berlin/Boston

Downloaded on 24.2.2024 from https://www.degruyter.com/document/doi/10.1515/jbnst-2021-0025/html
Scroll to top button