Minimum wage rises to 14.60 euros – is the 15 euro mark getting closer?

Minimum wage rises to 14.60 euros – is the 15 euro mark getting closer?

A significant increase in the minimum wage is imminent in Germany. The Minimum Wage Commission has decided to increase the legal minimum wage to 14.60 euros by mid-2027, they report Magdeburg News. Holger Hövelmann, the economic policy spokesman for the SPD parliamentary group, describes this step as necessary in order to take the changes in prices into account. His goal: A minimum wage of 15 euros, ideally soon and definitely in the next few years.

Hövelmann emphasizes that it is not about driving down wages, but rather about creating better conditions, especially in the service sector and agriculture. “Work has to be enough to live on,” is a clear statement from the SPD politician, who also sees the increase in the minimum wage as an expression of respect for hard workers in lower wage segments.

Price increases and demand for collective bargaining

Until the end of June 2025, the Minimum Wage Commission will continue to fine-tune the level of the minimum wage to ensure a fair adjustment over the next two years. This orientation is no longer only based on collective bargaining developments, but also on the ambitious goal of 60 percent of the median wage for full-time employees, such as Hans Böckler Foundation reported. Current calculations show that a minimum wage of between 14.88 and 15.31 euros is necessary to achieve this target by 2027.

An internal review of the Kaitz Index shows that Germany has often performed below international standards in the past. The statutory minimum wage, which was introduced in 2015 at 8.50 euros per hour, has now established itself as an integral part of German labor market policy. But despite the progress, the current minimum wage of 12.82 euros remains below the EU recommendation of 60 percent of the median wage, increasing pressure to discuss further increases.

Collective bargaining under pressure

Another construction site is collective bargaining in Germany, which has been declining for years. According to the WSI In 2023, only around 29% of employees in the private sector were covered by a collective agreement. The reasons are manifold: increasing fragmentation of the market and an increase in smaller companies that often do not have access to collective agreements.

Various parties have different ideas about strengthening collective bargaining. The SPD plans to increase the minimum wage to 15 euros by 2026 and at the same time promote collective bargaining through legal initiatives. In contrast, the FDP is more cautious and demands respect for collective bargaining autonomy without allowing political intervention in the minimum wage commission.

The Left Party goes even further and calls for an annual adjustment of the minimum wage to the inflation rate, while the Greens have already envisaged a minimum wage of 15 euros for 2025. The differences in political approaches make it clear that both collective bargaining and minimum wage policy will be on the political agenda in the coming years.

In summary, despite the progress in increasing the minimum wage, many policy challenges still lie ahead. Whether the desired goals will be achieved depends not only on the decisions of the Minimum Wage Commission, but also on the political majorities that will affect these issues in the coming years.