No net increase: Expert expects “offensive collective bargaining round”

According to the union's assessment, the employees have a lot of catching up to do in the upcoming collective bargaining negotiations.

No net increase: Expert expects “offensive collective bargaining round”

According to the union's assessment, the employees have a lot of catching up to do in the upcoming collective bargaining negotiations. Because of the strong inflation in recent years, the real wages of collective bargaining employees have fallen back to the level of 2016, explained the head of the WSI collective bargaining archive of the trade union Hans Böckler Foundation, Thorsten Schulten, according to the statement. He therefore expects an “offensive collective bargaining round” with numerous labor disputes.

There were drastic real wage losses, especially in 2021 and 2022. Last year, the purchasing power of employees was largely secured, Schulten noted. "However, in order to be able to compensate for the massive real wage losses of the two previous years, significant real wage increases are necessary in the coming collective bargaining rounds."

After evaluating the new contracts and previously agreed step increases, collective wages rose by 5.5 percent last year, twice as much as in the previous year. However, since inflation was at 5.9 percent at the same time, real wages will also fall by an average of 0.4 percent in 2023. However, the inflation compensation bonuses, which are not fully taken into account, could make the financial balance of many employees look better.

Last year, the demands were between 8 and 15 percent more money, often combined with minimum increases that were primarily intended to benefit the lower wage groups. In some rounds, a solution could only be found after extensive warning strikes. The demand for shorter working hours played a particularly important role in East Germany and in the steel industry.

Schulten said it would be important in 2024 to stabilize the weak economic development in Germany with strong real wage increases. The fact that, according to most experts, the inflation rate will fall to two to three percent this year makes it easier to implement real wage increases. Nevertheless, Schulten expects an “offensive collective bargaining round,” which is also likely to be characterized by labor disputes. The severity of the negotiations will depend on the extent to which employers recognize the interest in real wage increases.

According to the WSI collective bargaining archive, negotiations regarding the wages of 12 million employees are pending this year. The tariff year is already a heavyweight in purely quantitative terms. Among other things, negotiations are taking place in the metal and electrical industries, chemicals and the construction industry. The collective agreements in the federal and local public services will also expire at the end of the year. This backlog is particularly high in construction and at Deutsche Telekom, whose last wage agreements dated back to the period before the high inflation rates.

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