Problem addressed

To address long-term unemployment, the State of Berlin has initiated a pilot project called “Solidary Basic Income” (Solidarisches Grundeinkommen (SGE)), running from July 2019 to December 2025. This pilot offers long-term unemployed individuals a permanent job in socially relevant activities as an alternative to receiving unemployment benefits. The goal is for participants to transition into unsubsidized permanent employment, enhancing their reintegration and advancement in the labor market and social participation, while also promoting work that benefits the community at large.

Innovative solution

Around 1,000 permanent jobs were created in local public administrations, public companies, and social service providers for individuals unemployed for one to three years. These jobs offer fair wages and additional coaching and training to support participants' transition into unsubsidized employment. If participants do not transition, the jobs must benefit the community without replacing regular employment, such as by enhancing public transport or day care centre accessibility. Employers receive financial incentives and support, including coaching for HR staff and a EUR 2,500 bonus for each SGE employee who secures a job in the unsubsidized labour market.

Key results and benefits

By November 2020, all 1,000 slots in the Solidary Basic Income (SGE) program were filled. The initiative is being evaluated to guide future labor market policies in Berlin using various methods, including surveys.

Key lessons learned from the SBI program include the option to temporarily suspend contracts to allow for trial periods outside the program, easing concerns among employees about job security. There's also consideration of facilitating employer changes within the SBI to enhance participants' prospects for sustainable employment. The coaching service provider plans additional measures to boost labor market integration, such as increased support for internships. A revised incentive structure is also being explored to encourage transitions to non-subsidized employment based on evaluation insights. According interim evaluations the SGE has significantly benefited participants by reducing reliance on social benefits, providing stability and professional development, and receiving high satisfaction ratings. However, ongoing efforts are needed to address challenges related to job continuity and diverse employer frameworks for successful program implementation.

The program reduces job search pressure, increases motivation and commitment, and decreases government dependency. Employers value and aim to retain SGE employees. Overall, while the SGE program has achieved several positive outcomes, challenges remain in transitioning participants to unsubsidized employment. Employers and employees show little incentive to transition out of the SGE positions before the pilot phase ends.

Potential for mainstreaming

The Solidary Basic Income pilot in Berlin not only focuses on reintegrating long-term unemployed individuals but also showcases the potential of an unconditional basic income. Insights from the initiative could provide valuable guidelines for implementing similar programs in diverse societies, potentially influencing future policies aimed at enhancing well-being and equity in urban communities. 

Initial insights from the project also highlight potential challenges for other communities to consider. One issue is the conflicting signals that cause confusion among both SGE employees and employers. While employees are encouraged to enhance their personal and professional lives, the security of a steady income and the promise of ongoing employment can lead some to believe they have already achieved full integration, rather than viewing it as the start of a developmental journey. Conversely, employers acknowledge the substantial value SGE employees bring, which regular positions may not easily replace.