German Labor Market

Wages and Salaries

In 2008, German employees earned approximately 3,000 € per month. Although this seems relatively high compared to the average of the European Union at first glance, labor costs are relatively low by comparison to the high productivity of German workers: Unit labor costs increased in the European Union from 2004 to 2006 by an average of 1 to 2 percent, but they actually decreased in Germany during the period.

The development of labor costs in Germany is fairly stable and predictable, since industrial relations are dominated by regulated bargaining rounds which encourage trade unions and employers' associations to find mutual agreements. Strikes are regulated by collective labor law and only allowed as a last resort. In 2008, labor costs increased only by 2.5 percent which was the second lowest rate the European Union. Since 2001, Germany had been among the EU Member States with the lowest increase in labor costs.

Unlike some other European countries there is no general statutory minimum wage in Germany. There are however, collective agreements regulating wages in some industrial sectors. This is especially true for the construction industry proper, the roofing trade, the painting and lacquering trade, the demolition trade, the industrial cleaning trade, electricians, and letter mail service businesses.

Furthermore, in some industrial sectors the wages of temporary posted workers have to be equivalent to the average German salary. For more information, please refer to our pages on the posting of workers.