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Minimum Wage Dispute: Employers Slam SPD's Proposed Hike to 15 Euros by 2026
The SPD wants to push the minimum wage up to 15 euros by 2026, but employers aren't swayed. According to Steffen Kampeter, head of the Confederation of German Employers' Associations (BDA), this figure is the product of "wage populism" with no rational foundation. He warns that linking this wage to 2026 would bring economic chaos.
Even though some increase in the minimum wage is imminent, Kampter believes 15 euros isn't feasible in the short term. Since January, the minimum wage has been 12.82 euros per hour.
Criticizing the minimum wage's negative structural effects, Kampeter points out how an excessively high wage is driving vegetable production abroad, leading to self-sufficiency issues with vital staple foods. He also highlights the upward shift in the entire wage structure due to the minimum wage increase, causing cost pressure that impacts industry jobs and services.
When Labor Minister Barbara Bas called for an increase to 15 euros per hour, Kampeter expressed his disappointment. He found her threats "beneath the government" and emphasized the need for respect and no interference in the Minimum Wage Commission's work.
Experts predict more moonlighting if the minimum wage rises, but data from the Federal Statistical Office indicates this increase should only be around 14 euros. Kampeter, reminded of the law's requirement for a balanced assessment in light of the economy's current state, struggles to justify such a dramatic increase. He advocates for moderation, not naive optimism, given the economic data at hand.
Employers such as Oliver Zander of Gesamtmetall fear inflation and price hikes, especially in sectors like hairdressing and gastronomy, due to such a substantial wage increase. The fragile economy, marked by factors like the Ukraine war and trade tensions, adds to their concerns.
Smaller businesses could also struggle with the increased costs, potentially leading to closures, especially in regions like Eastern Germany. Politicizing the wage-setting process is another issue employers raised, wanting decisions to be based on economic conditions and sectoral needs instead of political agendas.
A rapid rise of 76% in a decade, as proposed with the 15 euros per hour wage, could disrupt wage uniformity across the labor market, potentially leading to unintended consequences like reduced hiring or increased unemployment in certain sectors.
Sources: ntv.de, lme
Minimum Wage | Bärbel Bas | Employees | Trade Unions
The community is in debate over the SPD's proposed minimum wage increase to 15 euros by 2026, with employers expressing concerns about its impact on businesses. Finance experts emphasize that such a rise might lead to inflation and price hikes in several sectors, causing strain for small businesses and potential closures.
In the political landscape, criticism arises towards politicizing the wage-setting process, with employers preferring decisions based on economic conditions and sectoral needs rather than political agendas. Vocational training could play a crucial role in addressing these concerns, as it equips employees with the necessary skills to adapt to the evolving job market and mitigate the potential impact of increased wages on employment.
