Tariff increases in many sectors: significantly higher salaries despite the crisis – economy

Crisis, what crisis? As the economy loses more momentum from month to month and the probability of a recession increases with the cutback in gas supplies from Russia, the trade unions are kicking ass. Verdi is striking the six German seaports this Thursday to enforce a demand of up to 14 percent. For the ground workers at Lufthansa, who had to be rescued by the federal government in the first year of the pandemic, the union is calling for 9.5 percent. In contrast, the seven to eight percent who which IG Metall presents as a wage increase for almost four million metalworkersalmost modest.

12.6 percent more for cleaners

For employees in low-wage industries, the increase in the statutory minimum wage to twelve euros on October 1st is noticeable. Ten days ago, the collective bargaining partners in the building cleaning trade agreed on an increase of 12.6 percent for around 700,000 employees: the hourly wage will be EUR 13 from October. And 800,000 temporary workers also get a much higher industry minimum wage: the lowest wage group will increase by 24 percent to 13.50 euros by the beginning of 2024. The increase in the statutory minimum wage from 10.45 euros (which will apply from July) to 12 euros from October makes it possible, as employers are willing to pay more in the competition for workers than the legislator prescribes for everyone.

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The biggest collective bargaining disputes are coming up in autumn, when the metal and chemical industry unions want to push through permanent increases in the pay tables again after lean pandemic years with special payments. That’s the plan. But the economic situation is changing rapidly. The chemical employers called for a moratorium on stress on Wednesday. “After a decade of upswing, we are threatened with a long phase of stagnation, perhaps even recession,” said Chemical Association President Kai Beckmann. In the coming months, it may be “essentially no longer about distributing gains, but with less prosperity, less social security and increasing burdens to deal with,” said Beckmann. The chemical industry is the largest gas consumer.

The chemical industry, in the picture the BASF plant in Ludwigshafen, is the largest gas consumer in Germany.Photo: dpa

The fear of the future has also arrived on the stock exchange: world market leader BASF was the weakest value in the Dax with a minus of more than five percent on Wednesday. “In view of the vehemence of the challenges from transformation to the pandemic to the consequences of the war, every stone in the company’s backpack is one stone too many,” Beckmann said at the association’s general meeting in the direction of politics and the union.

IG Metall’s demand is harmful

Joachim Schulz sees things very similarly in the metal and electrical industry. “We can actually say that for the majority of companies not bear any costs“, said the chairman of the employers’ association Südwestmetall. Schulz, who has been on the board of the medical technology company Aesculap in Tuttlingen for many years, is leading negotiations with IG Metall in September. The union’s demand for seven to eight percent more wages did not surprise him. However, he considers an increase of this magnitude with a collective agreement term of twelve months, as imagined by IG Metall, to be “unrealistic and harmful,” said Schulz. If that were to happen, “as a medium-sized company, I would think about leaving the association”.

IG Metall justified the demand on Monday with good earnings figures in the vast majority of companies, high order backlogs and the meager wage agreements in recent years. Schulz admits the high order backlog, but the order intake is now declining. And production is still 17.5 percent below the peak value from 2018. After all, the profit margins would drift apart, which is why “one solution does not fit all”, Schulz pleaded for a differentiated collective agreement.

30 percent more money in 20 years

Schulz also suggests that the fat years should be over. Since 2000, the metallers have received around 30 percent more money, i.e. after deducting the inflation rate. “We don’t have to talk about the poverty of the employees,” said the employer.

Competing for labor costs money

The situation in the guard and security industry is different. According to the currently valid collective agreement, employees in the lowest wage group receive an hourly wage of 11.35 euros. Verdi is now demanding an increase for the security guards that is well above the statutory minimum wage: 13.90 euros. The employer side offers an increase to 12.50 euros. Verdi rejects this and, as justification for the demand, refers to the difficulties faced by companies in finding security guards. This is what high-wage and low-wage sectors have in common: there is a shortage of workers everywhere.

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