Real wages continue to rise: Low earners benefit 2025!

Real wages continue to rise: Low earners benefit 2025!

Deutschland - Real wages in Germany recorded an increase of 1.2 percent compared to the previous year in the first quarter of 2025. This already represents the eighth increase in a row. The nominal increase in wages was 3.6 percent, while consumer prices rose by 2.3 percent in the first three months. These developments show a positive tendency, although the increase in nominal wages has been the weakest since the fourth quarter of 2022. The decline in inflation compensation bonus, a tax and tax-free one-off payment of up to 3,000 euros paid by the end of 2024, is considered the main reason for the moderate increase in real wages. In addition, the figures show that the highest wage increases of 7.2 percent in the first quarter of 2025 were observed among the low earners, while full -time forces received a gross wage increase of 3.6 percent. This reports ZVW .

The development of real wages is to be considered against the background of a strong increase in 2024 when real wages rose by 3.1 percent. This increase was considered the strongest in 16 years and was due to several factors. The sunken inflation, the introduction of inflation equalization bonus and high tariff degrees contributed significantly to the improvement of wages. The average wages increased by 5.4 percent in 2024, while consumer prices only increased by 2.2 percent. Nevertheless, experts warn that the loss of inflation premium could dampen wage development in 2025. This year, the declines of the consumer climate and the uncertainties in the economy could lead to workers becoming more reluctant to become more reluctant for larger purchases, which could also have a negative impact on wages. This analysis has published Tagesschau

Influence of consumer prices and wages

The development of real wages is closely linked to the change in consumer prices and the average gross monthly earnings. The real wage index measures the purchasing power of the workers and is calculated by dividing the nominal wage index by the consumer price index. A positive change rate indicates that wages have increased faster than prices, which is advantageous for the purchasing power of the employees. Conversely, a negative rate of change means that consumer prices rise faster than wages. The calculation of the nominal wage also includes special payments and takes place at regular intervals. Thus, the real wage index remains an important instrument to understand the state of merit in the context of the cost of living, as Destatis

The new earnings and their relevance for the German economy illustrate the developing wage market. The structure of the employees is kept constant in order to precisely map the real merit development. It will be particularly exciting to see how wages and purchasing power will develop under the influence of current economic challenges.