Social expenditure-to-GDP ratio

In 2019, the level of social expenditure according to the European System of Integrated Social Protection Statistics (ESSPROS) as a percentage of gross domestic product (GDP), expressed by the social expenditure-to-GDP ratio, was 29.3%. From 2008 to 2010 as well as in most of the years from 2012 to 2016, the increase in social expenditure has been much higher than economic growth due to the financial and the euro debt crisis and was lower in the other years.

If wage tax and social contributions, partly due from cash benefits, were deducted from social expenditure, the net social expenditure-to-GDP ratio was -2.8%age points lower (2018: 26.4%). Before the tax reform in 2016, the difference between net social expenditure-to-GDP ratio and social expenditure-to-GDP ratio was -3.1%age points (2015). Social benefits paid after consideration of deductions were above all guaranteed remuneration by employers in the event of sickness, above bad weather compensations for building workers, pensions and sickness benefits, while benefits for families were granted in full.

Since these were ratios, both development relating to individual benefits as well as change in GDP growth need to be taken into account during the relevant periods. It should also be noted that GDP data before 1995 were calculated on the basis of ESA 1995 and data since 1995 have been calculated on the basis of ESA 2010 causing a break in the times series of the social expenditure to GDP ratio in 1995.

Please consult our German website for tables and charts containing further information.

Results (overview): Social expenditure-to-GDP ratio

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