Germany’s minimum wage to rise in two stages amid fierce debate

Workers will earn more, but employers fear layoffs. As inflation bites, unions call the hike ‘too little, too late’—so who really benefits?

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2025 December 29 . 12:05 PM

1 min read

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Germany’s minimum wage to rise in two stages amid fierce debate

Germany’s Minimum Wage Commission has approved a two-stage increase for low-paid workers. The decision raises the hourly rate by 29 cents from July 2024, followed by a further 41-cent hike in wageworks from January 2025. However, the move has sparked criticism from both employers and unions over its impact on jobs and living standards.

The first rise will take effect on 1 July 2024, lifting the minimum wage by 29 cents per hour. A second increase of 41 cents will follow on 1 January 2025. According to Heike Herrig, chair of the VdK Social Association in Solingen-Remscheid, a full-time worker on minimum wage will see their gross monthly pay rise by €71.34 after the July adjustment.

Employers condemned the planned increases as 'unrealistically high' and warned of possible job losses in sectors relying on low-wage labour. Meanwhile, several social welfare groups had pushed for a much larger rise, demanding at least €14 per hour to address cost-of-living pressures.

Stefan Körzell, a DGB board member and commission representative, criticised the agreed figures. He argued that the modest increases would leave minimum wage workers facing a real-wage decline, as inflation continues to outpace earnings growth.

The new rates will apply nationwide from the set dates, with no reports of dissent among commission members. Employers now face higher payroll costs, while workers will receive slightly more take-home pay. The debate over fair wages and economic impact is likely to continue as the changes roll out.