At the turn of the year, the minimum wage comes with some small change.
Photo: dpa/ Marijan Murat
The unions are angry: »We could not lend a hand for an adjustment of just a few cents. With this decision, the almost six million minimum-wage employees suffer an enormous loss of real wages,« said DGB board member Stefan Körzell on Monday about the decision of the minimum wage commission to raise the statutory lower wage limit. Accordingly, the minimum wage at the turn of the year is to rise from the current 12 euros to 12.41 euros. This corresponds to an increase of around 3.4 percent. From January 2025, the gross minimum wage will be EUR 12.82 per hour.
Trade unionist Körzell is himself a member of the minimum wage commission. In addition to him, two other union representatives, three employer representatives and the chairwoman of the commission, Christiane Schönefeld, sit on the committee. Two economists are also part of the board, but have no voting rights. The Federal Government makes the decisions of the Commission on the minimum wage increase legally valid by ordinance. Most recently, the minimum wage was raised to twelve euros by law in October 2022, as this was primarily an election campaign promise by the SPD.
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In the current decision of the minimum wage commission, the representatives of the employer side apparently together with the chairperson overruled the union. “It is shameful that in this situation with the highest inflation rates, employers want to save on the financially weakest of the labor market,” criticizes Körzell. According to a statement by the DGB, the minimum wage should have risen to at least 13.50 euros. In addition, the EU minimum wage directive must be implemented by the end of 2024, according to which the minimum wage must be at least 60 percent of median income. This would correspond to a minimum wage of at least 14 euros.
Economists and the Left Party also criticized the insufficient increase in the minimum wage. “For employees in the low-wage sector, the small increase means that they will continue to suffer a significant loss of purchasing power and will therefore have to tighten their belts,” explained the President of the German Institute for Economic Research, Marcel Fratzscher. The consequence for many people is that “they will have to rely on additional services, such as the food banks, or have to become over-indebted”.
For the deputy chairwoman of the left parliamentary group, Susanne Ferschl, the adjustment is “a slap in the face” for employees in the low-wage sector. “For millions of employees, the decision means a significant loss of real wages over the next two years,” says Ferschl.