The number of self-employed people claiming the basic Hartz IV payment shot up from 72,000 in 2007 to 127,000 in 2011, research by the Nuremberg Institute for Employment Research (IAB) shows.
They now swell the 1.4 million-strong army of working people who rely on the state to get by - despite government reforms aiming to make work pay.
Germany's lack of a minimum wage has encouraged a flourishing, and controversial, low-wage economy. This new study shows how many of the self-employed are also failing to make ends meet.
Almost two-thirds of self-employed benefit claimants - dubbed 'topper-uppers' because of the way in which they are forced to supplement meagre incomes - earned less than €5 an hour, according to the study.
The most common occupations among this group included sales assistants, owners of pubs and fast-food outlets, musicians, freelance teachers, and language instructors.
Almost half of those unable to cover their basic needs were already working full-time.
They also tended to be significantly better educated than other welfare recipients. Almost 20 percent were university graduates; just 16 percent were wholly unqualified.
Despite this, three-quarters earned less than €400 a month. The evidence also suggests that they may well be caught in a tough poverty trap: only a quarter of those relying on state support in 2009 had managed to become self-sufficient a year on.
These recent figures are bound to fuel the growing unease felt within Germany at the growing numbers of the working poor - those earning so little that they cannot survive without state assistance.