Tuesday, June 26, 2018

Germany: Minimum Wage Talk

On German business news with Channel One (ARD, public TV), I noticed this morning that there is a plan to raise the minimum wage in Germany.

Every two years, there's a group of PhD folks, employers, and trade union members who meet.  They talk over the current wage, and the inflation conditions.

Currently, the minimum wage is set at € 8.84.

What the Commissions says is that it ought to go up to € 9.19 in 2019 (month to be set by Bundestag) and later a second raise in 2020 to € 9.35.

Naturally, some political folks (the Linke Party is mentioned) thinks it's too low.

The last time it was raised?  It goes back to January of 2015.  My guess is that once the second episode occurs in 2020....it'll be two to three years before the discussion comes up again.

Public reaction?  I think most of the low-wage earners will tell you that it's not working and they are barely surviving off the 8.84 of today.  Most would prefer to see something in the range of 12-Euro.

Will this affect the mini-job rate?  No, but it'll encourage the Bundestag to go and pick up the mini-job rate, and talk about another 30-odd Euro raise, I think.

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