Low-paid employment has increased considerably in Germany and Austria over the past fifteen years. In Germany this has resulted in one of the largest low-paid employment rates in comparison to other European countries. At the same time, Austria, loses its special position as a country with a particularly small low-paid sector. The article investigates the underlying causes for the increase in low-paid employment and seeks to identify those groups that are at risk of falling into the low-wage group. Finally, the article addresses the question of what are the similarities and differences between Germany and Austria. For the empirical analysis we use the SOEP-data for Germany and the EU-SILC data as well as the ECHP-data for Austria. Our analysis encompasses the time period between 1996 and 2010. Methodologically, regression and decomposition analysis are used. Our results show that certain groups on the German and Austrian labour markets have faced increasing risks of entering low-paid employment over the last fifteen years. These risk groups are mainly women, migrants, persons with low qualifications or in atypical jobs as well as employees in the agriculture sector, the hotel and restaurant industry and in the personal service sector. Moreover, it could be observed that changes in the composition of the labour markets (e.g. growth of highly qualified jobs) slightly slowed down the rise of low-paid employment rates.
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