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BERLIN

Berlin named top city worldwide to earn money while travelling

A new report reveals why the German capital is the best place for "digital nomads" looking to travel the world while still making a living.

Berlin named top city worldwide to earn money while travelling
The Agora Collective co-working space in Berlin. Photo: DPA.

UK freelancer job market PeoplePerHour released a report on Wednesday that ranks Berlin as the top place worldwide to be a digital nomad – someone who works by computer while travelling.

The study took into account things like the number of co-working spaces, office rental costs, the overall cost of living and crime rates.

“People across European countries are now more often self-employed after the financial crisis,” PeoplePerHour spokeswoman Aylish Jarvie told The Local.

“People are making use of that freedom and with the ability to have clients around the world, you yourself can travel as well.”

Top five places for digital nomads

  1. Berlin
  2. Istanbul
  3. Bangalore
  4. Vancouver
  5. Lisbon

Freelance writers, social media managers, designers, and web developers, to name a few, are more likely to be able to choose where they want to set up shop across the globe.

“If you’re looking at a place where want to work and have the choice of anywhere in the world, then you need a place with decent co-working places, where you can network and not be isolated while you work,” Jarvie noted.

“And people want their money to go further. There are low rents in Berlin, and then the quality of life puts the icing on the cake.”

Berlin’s divided Cold War past is part of what has made it struggle to catch up economically to Germany’s more industrious hubs like manufacturing-rich Munich, or the finance centre of Frankfurt. But it’s also part of what has kept rents relatively low, thus attracting young, hip freelancers and creative types from around the world.

SEE ALSO: Why Berlin is known as the 'failed city'

But this demographic is also often blamed for the quickly rising housing costs. Between 2015 and 2017, average rent shot up by nearly 10 percent, and over the past decade prices soared by about 70 percent.

Nevertheless, the cost of a flat in Berlin is still generally lower than Germany’s other major cities, which continues to make it appealing for startups – another aspect of PeoplePerHour’s research. The freelancer market also ranked Berlin as the second best city for starting a business, behind Canada’s Vancouver.

Similar to the digital nomad report, this ranking took into account quality of life and office space, as well as ease of “getting a company off the ground”. This meant Berlin beat out the tech mecca of San Francisco (21st place) as well as its British rival London (14th).

Immediately after the UK’s narrow vote to leave the European Union, some experts predicted that Brexit would turn Berlin into Europe’s new startup capital.

SEE ALSO: London v. Berlin – Which is better for startups?

“They’re clearly doing well in Berlin,” said Jarvie.  

“A lot of US startups will choose Berlin as their mainland Europe hub… What attracts talent is also having a really good life outside work, so the nightlife helps as well.”

Still, a recent report by German bank KfW showed that the number of entrepreneurs in Berlin had decreased in recent years, and Hamburg actually came out on top for the first time with the highest comparative number of people starting businesses.

Jarvie said that the top cities ranked by PeoplePerHour are not only where young Millennial professionals are heading for work, but are also the hotspots of the future.

“The generation following Millennials are already 20 or even 21. This is where they’ll end up working.”

For members

WORKING IN GERMANY

Five things to know about salaries in Germany

Finding a job is typically a top priority when planning a move to Germany. The country boasts the third largest economy in the world and a continuing need for skilled professionals. 

Five things to know about salaries in Germany

If you are moving to Germany, you might soon start looking for a job in the country. However, like many other aspects of living abroad, there are several cultural differences and specificities when it comes to job hunting in Germany – especially when it comes to salaries.

Here are five things to know about salaries in Germany.

There is a minimum wage in Germany

Germany’s minimum wage of €12.41 per hour, pre-tax came into effect at the start of this year. This amounts to a monthly salary of €2,054 which ranks ninth in the world. The minimum wage will rise again in 2025 to €12.82 per hour before tax deductions.

There have been calls recently to hike the salary up higher to €14 per hour.

READ ALSO: Millions of workers in Germany ‘earning less than €14 per hour’

Find out salary expectations

Germany does not require companies to list salary ranges for listed positions. But that may be changing soon. The EU parliament passed a wage transparency law to require companies to publish annual reports detailing wage and wage discrepancy information. The rules, which are set to go into effect in 2027, are intended to help close the gender pay gap. 

In the meantime, employees can utilise online resources to find industry averages and expectations for different roles:

  • Gehalt.de offers users access to salary information on more than 800 professions
  • Online platform, Kununu provides compensation information and employer reviews to users in the DACH region  
  • Berlin residents can utilise REDSOFA’s salary survey for an overview of salary averages in the country’s capital city

As of April 2023 the average gross monthly salary was €4,323 according to Germany’s Federal Statistical Office.

Two-thirds of full time workers make less than this average monthly salary and one-third of workers earn more than this average monthly salary.

While wages after deductions may be less than similar roles in other countries, it is also important to take into consideration what other benefits come with a salary. Paid holiday leave, pension contributions, long notice periods and annual bonuses can help make up some of that difference. 

READ ALSO: How much do employees in Germany typically earn?

Check your payment schedule

Internationals can usually expect their salary once a month when working in Germany. Many German companies choose to pay employees either on the 1st or 15th of the month. It is also important to note that most employees can expect to receive their first pay check within 30 or 45 days of starting. 

For positions that offer yearly bonuses, these payments are included in a 13th pay check which are subject to income tax.  

A person works on a laptop.

A person works on a laptop. Image by Bartek Zakrzewski from Pixabay

How many hours do you work?

When looking for a job, don’t forget to check how many hours you can expect. Job descriptions will include expectations for time commitments. 

Mini-jobs, as expected from the name, are limited in hours and pay. Employees can expect up to €538 per month. Mini-jobs do not provide social security because they do not require social security contributions. Employees are also not automatically covered by health and nursing care insurance. 

Teilzeit, or part time jobs, are defined as any job where working hours are less than a full time position.

A common misconception is that part-time work requires working 20 hours or less a week. But an employee working five days a week for 30 hours, at a position that is typically 40 hours when full time can also be defined as a part time worker. 

READ ALSO: The rules in Germany around ‘mini’ and ‘midi jobs’

In fact, Germany has a term for workers who work between 28 and 36 hours a week. Vollzeitnahe Teilzeit, or nearly full time part time workers, can be a popular choice for some people, including parents. These positions can give employees more flexibility to balance work and family responsibilities. It is important to note that these workers are paid according to their time worked, so it will still amount to less than full time.

Depending on the work schedule, part time employees can earn the same amount of vacation as their full-time counterparts. That’s because holiday leave is calculated based on days worked, not hours. If a part time worker comes in five days a week, they will be eligible for at least 20 days of holiday. If that same part time worker comes in three days a week, they will be legally entitled to twelve days of vacation, even if they worked the same hours as the other employee. 

In most companies, weekly working hours between 35 and 40 hours are considered full-time employment or Vollzeitbeschäftigung

Watch out for the gross v. net difference

Before you sign the dotted line, it will be important to check how much of your gross salary you’ll be able to keep come pay day. Companies that include salary expectations in descriptions include gross salary (Bruttoeinkommen) – not the net income after taxes and deductions (Nettoeinkommen). The amount deducted will depend on how much you earn, the tax class you’re in and on other factors such as how much you’re paying for healthcare but it is usually around 40 percent. 

Salaried employees can find information on the deductions on their pay slip. Some to expect to see include:

  • Taxes are deducted directly from the gross pay. The amount is based on the tax bracket your salary falls within 
  • A percentage of your gross salary is also deducted for your pension / retirement contributions
  • Church taxes between eight and nine percent of your salary will also be due if you are affiliated with a religion
  • Unemployment insurance amounts to a 2.5 percent deduction from your gross salary. It is important to note that the insurance covers a salary up to €90,600 
  • Health insurance contribution rates are typically split between employers and employees. The rate depends on the provider. In 2024, the TK contribution rate to health insurance is 15.8 percent of the gross income

READ ALSO: What you need to know about your payslip in Germany 

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