It is tough for new expats to get a real feel for what is considered a good salary. So, with thousands of internationals relocating to Germany every year, you're not alone in wondering how to go about negotiating your pay. But knowing the average salaries in Germany, the minimum wage and how that relates to the cost of living will navigate you in the right direction.
To save you time, this guide will walk you through all things salary-related and answer your questions about:
So keep reading! We got you covered!
As of October 1, 2022, the gross minimum wage in Germany is €12 per hour.
This minimum wage also applies to expats, international students, and overtime work (unless your contract states otherwise or you agree to take time off at a later date).
Here’s a tip: The minimum wage in Germany is usually updated around January and July. Check Zoll, the German Central Customs Authority, to stay up to date with the latest minimum wage.”
Let's do simple maths. With a 40-hour week as a full-time employee, you'll easily earn a minimum gross salary of €2,080 per month! After-tax, the minimum German salary equals €1,503 per month.
Now, it's good to keep in mind that (international) students don't need to pay taxes or social security contributions in Germany if they earn less than €450 a month.
Since taxes in Germany are high, you can work for 37 hours a month and earn minimum wage to ensure your monthly income will not be over €450.
Did you know that even interns are entitled to a minimum wage in Germany?
Your internship has to satisfy the following conditions:
Choosing to work in Germany as an English-speaking expat is a great decision as Germany pays a rather high net average salary compared to the cost of living.
Assuming that you're a young starter moving to Berlin, your average living costs will be as follows:
|Total living expenses||€1,386|
This means that you need to earn just above the minimum wage (€1,503 net) to live comfortably in Berlin! But earning the average net salary of €2,636 would mean that you could set aside roughly €1,000/ month or afford a bigger flat in one of the best neighbourhoods.
A good salary in Germany not only depends on your lifestyle but also on where you live as the cost of living differs from city to city.
But, in general terms,
A good annual gross salary in Germany is between €64,000 to €81,000.”
But most Germans who earn a yearly gross salary of €60,000 and above are happy with their salary.
a monthly gross average salary for a full-time employee in Germany was €4,100 in 2021. That's the annual gross salary of €49,200.”
That means that the average net salary Germans bring home is €2,636.
The net salary is your salary after tax and any social contributions and it's the best indicator of how much you're really earning.
To calculate your net salary easily, you can use this tool.”
Let’s put it in perspective with a little table comparing the average net salary with other gateway countries in the EU.
|Country||Avg Net Salary (2021)||Comparison with DE|
As you can see, working in Germany results in a net salary that is on average 5% higher than in the nearby expat havens.
And keep in mind that even though the average salary in the Netherlands is somewhat higher, the cost of living in Berlin is way lower compared to Amsterdam.
Don't forget; your salary depends on your profession, industry, and education.”
Here’s an overview of the gross annual average salary of the top 15 professions in Germany.
|Profession||Avg. Gross salary|
|Distribution and Sales||€59,591|
As you can see, your career choice determines your average salary in Germany. A complex curriculum that involves a great deal of responsibility, such as being a doctor or lawyer, is rewarded with a generous salary.
However, this is just a snapshot of the average income in Germany. Salaries differ depending on your industry, your experience and education, the size of the company, the region, and your gender.
Here’s a deep dive into all the factors that influence your salary in Germany.
While it’s good to know the average gross annual salary in Germany, it’s also good to remember that if you’re just starting out, it can take 10 years or more to reach this level.
Here’s how much you can expect to earn in Germany based on your years of work experience:
|Years of Experience||Avg. Gross salary|
|Less than 1 year||€38,932|
|25+ years||€ 67,480|
Apart from age, your experience in managing people also influences your salary.
|Number of Employees||Average Annual Gross Salary|
|Up to 14 employees||€65,257|
|Up to 100 employees||€79,562|
|More than 100 employees||€96,357|
As Stepstone points out, large companies (+10,000 employees) in Germany can approximately pay a whopping 29% above the average salary of €56,985 !
Medium- to large-sized companies (5,001 - 10,000 employees) top the average gross salary in Germany by approximately 18%. Medium-sized companies (1,000 - 5,000 employees) exceed the average by approximately 13%. On the other hand, startups or smaller companies with up to 250 employees tend to pay much less than the average salary (-23% to -6%).
So, remember: The bigger the company, the higher your salary is likely to be.
Academics in Germany receive an average salary of €58,058 as opposed to non-academics who earn €49,346.
To put it in perspective, someone in finance can earn €78,769 with an educational background and €61,596 with a vocational background.
Even for those who are educated, master's degree holders can expect to earn an annual gross salary of €61,906, compared to those with a bachelor's degree who earn €54,210. And while a 14% difference might look small now, it will definitely make a big impact on your savings and net worth as you grow older.
There is one exception when education is not a strong factor in determining your salary. If you are an IT professional with 7 years of work experience and no educational or vocational background, you are in luck! Find out if switching to a different visa type might be more useful for your situation.
Did you know that there are major differences in salaries within Germany?
According to the most recent StepStone survey, the best-paying companies are located in the South. In Hessen people earn €60,936 on average, followed by Baden-Württemberg (€60,182) and Bavaria (€60,013).
The top 3 large cities in the South also boast the highest-paid salaries. Frankfurt am Main accounts for the largest average gross salary at €66,529, followed by Stuttgart (€66,174) and Munich (€65,164).
What is the rationale behind this?
Many major corporations have their headquarters in these federal states or cities. For instance, Stuttgart has several automotive, high-tech or consumer goods industries, Frankfurt is the financial hub with its airport and trade fair, and Hamburg hosts many media houses and consumer goods companies.
While you might want to flock to these highest-paying large cities, do keep in mind the high cost of living in cities such as Frankfurt.
Now compare the salaries in the South to the salaries in the North and East of Germany.
Brandenburg in the North has the lowest average annual gross salary of €47,008. Popular northeastern cities like Berlin also have a comparatively low average annual gross salary of €53,408.
So it's good to compare cities to decide which one's the best to live in for you.
According to a survey by the Federal Statistical Office of Germany, men earn an average of €3,964 per month, while women earn considerably less, at €3,300 per month.”
The XING study also highlights the fact that women still earn far less than men in all professional fields. In most cases, they only receive three-quarters of what men earn.
Last but not the least, your payslip issued at the end of the month will also influence the salary paid to your bank account.
At the end of the month, you'll be issued a payslip for your tax return which will most likely be in German. Don't worry. We'll walk you through the sheet of paper step by step so that you'll understand it in no time at all!
But before we get to that, let's start by clearing up the difference between gross and net salary:
The gross salary (Bruttogehalt) is your monthly salary without deductions. It is also the sum that was agreed upon in your employment contract.
The net salary (Nettogehalt) is the amount paid into your account. This is the salary from which income tax, social security and other payments have already been deducted. Income tax is usually around 35% (which varies depending on the gross salary).
In other words: If you have a gross salary of about €3,000 you will receive about €1,900.”
Now back to the payslip breakdown.
1. Employee data: Your personal details are recorded here, such as your full name, date of birth, tax and social security details.
2. Presence overview: Your vacation and working hours are recorded in this field. So you can see your exact times of absence.
3. Address field: Your address should be here, but also your staff number and maybe your department number. You’ll also find the address of your employer here.
4. Accounting details: The cost centre, working hours, hourly wage or notes on parental leave are recorded here; all additional values, so to speak.
5. Gross pay: This list shows you, line by line, the breakdown of your monthly payments. This includes your hourly wage, holiday pay, and vacation pay, and is always linked to tax and social security obligations. Oh, a note: "****" indicates further information from the payroll office.
6. Tax/Social Security: This section shows you exactly why your generous gross salary has shrunk dramatically. Here you'll find a list of income tax, church tax, solidarity surcharge and other tax deductions.
7. Net salaries/net deductions: Right at this point you can see what you should ultimately receive in your bank account. Should there be other contributions listed here, these will be added or deducted from your net income. So, here is your net income!
8. Payout sum: Read it one more time here: your net income. Make sure that you have received this amount in your bank account.
9. Bank details: Your salary didn't roll in on your bank account? Then have a look here to see if your bank details are correct.
10. Total costs for employers: Your employer usually lists the total costs (e.g. social security contributions)
11. Certificate of Merit: All accrued gross pay and deductions that have arisen in this employment relationship are listed here.
12. Footer: Small print to explain all abbreviations and legally-required information here.
13. Company pension scheme (bAV): The contribution you have made to the pension fund is indicated here. This contribution is not subject to tax; it is deducted directly from your net income.
And when you're ready to pursue your dreams in this exciting country, start looking for your new place!
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