Germany’s pension outlays reach €423 billion as unemployment climbs above 3 million

In 2023, about 22.5 million people in Germany received pensions, with total payments amounting to roughly €423 billion – a 5.1 % increase over the previous year. Around 72 % of these payouts, €304 billion, were subject to tax, reflecting the impact of the deferred‑tax regulation introduced in 2005. The average taxable share of pensions has risen by 16.4 percentage points since 2015.

Meanwhile, the German labour market showed signs of weakening. In July, official figures recorded just over three million unemployed persons, an increase of 71 000 from June and raising the unemployment rate to 6.4 %. Seasonal factors typically raise July unemployment, but analysts warned that the rise signals a deeper, structural slowdown in the economy, affecting sectors such as automotive, machinery and chemicals.