This has delivered a 4.3% pay rise for workers in the state of Baden-Würtemberg in the south west of the country. While only a regional deal at this stage, in the way of these things it is expected to travel throughout the metal-working and electronics sector in Germany.
Baden-Württemberg is home to several large manufacturers including the carmaker Daimler.
According to the IG Metal website despite a degree of initial confusion employers in Saxony have also signed the agreement and it appears they will be followed by their counterparts in North Rhine-Westphalia and Lower Saxony.
The agreement will last for 13 months and was concluded following 17 hours of negotiations near Stuttgart, which dragged into the early hours of Saturday. It ends weeks of partial walkouts and industrial action.
The employers had previously offered 2.6% in response to union claims for a 6.5% increase. Not hard to see how they settled on 4.3%!
It removes the threat of the sector’s first full-blown industrial action in a decade.
Not the first increase in Germany!
The deal follows a pay rise of 6.3% for the two million workers in Germany’s public services earlier this year.
Workers in Ireland and elsewhere in Europe will be casting an envious eye at these developments as they cope with redundancy and wage cuts but clearly they reflect realities in the German economy which are not present elsewhere.
It confirms a simple business truth that workers will share in economic growth if they contribute to it.
Comments by Finance Minister Wolfgang Schäuble to the weekly newsmagazine Focus that German workers ‘deserved’ pay increases provide an interesting perspective on the growth v austerity (Hollande v Merkel) debate going on in the Eurozone at the moment.
“It’s normal that wages rise faster here than in other EU countries,” Schäuble said. “We have years of reforms behind us, and by increasing pay, Germany will help reduce economic imbalances in Europe.”
Further elaboration needed on this perhaps, but a very interesting comment.
Source (dpa, Reuters); edited; Workplace Solutions.
See also www.igmetall.de/ Alas, Google translation is practically unintelligible
May 26th 2012