Status: 07/11/2022 3:23 p.m
IG Metall is demanding eight percent more wages for the approximately 3.8 million employees in the metal and electrical industry. Collective bargaining begins in September with employers who believe the demand is unaffordable.
The board of directors of IG Metall has decided to take part in the forthcoming collective bargaining negotiations in the metal and electrical industry with the demand for an eight percent wage increase. All collective bargaining commissions of the districts had spoken out in favor of this in advance. According to the ideas of IG Metall, the planned wage agreement for the approximately 3.8 million employees in the metal and electrical industry should apply for a period of twelve months.
Jörg Hofmann, first chairman of the union, justified the wage demand with the fact that employees’ budgets must be relieved in view of the sharp rise in consumer prices. The economic situation is good for the majority of the companies. With a view to the consequences of a possible gas supply stop, however, he said that the situation would be reviewed again in autumn with a view to the collective bargaining round.
It is also the task of politics to intervene in the “enormous problem of price increases”. “We cannot compensate for the current rates of inflation with collective bargaining alone,” said Hoffmann. The requirement of eight percent is the highest since 2008. Previously, IG Metall had already demanded a wage increase of eight percent for the pending negotiations on the company wage agreement at the car manufacturer Volkswagen.
Companies warn of threats to their existence
In June, employers already criticized the foreseeable wage demands of IG Metall of up to eight percent. “To talk nice about the situation in the metal and electrical industry is irresponsible,” said Stefan Wolf, President of Gesamtmetall. “At the moment, 94 percent of all member companies of our associations have to cope with massive cost increases.” Just one percent of all companies in the industry are able to fully pass on the cost increases through price increases to their customers. A fifth of the companies even see an economic threat to their own company in view of the developments. Of the approximately 26,000 companies in the metal and electrical industry in Germany, only focusing on around one hundred companies that are doing particularly well does not do justice to the complicated situation.
In view of the high inflation on the one hand and the difficult economic situation as a result of the Ukraine war on the other hand, IG Metall and Gesamtmetall are heading for difficult collective bargaining, which should start in mid-September. The so-called peace obligation for the metal and electrical industry ends at the end of October. From October 29, warning strikes in the industry are possible.
In the spring, IG Metall went into collective bargaining for the 68,000 employees in the north-west German steel industry with the demand for a wage increase of 8.2 percent – after tough negotiations and warning strikes, both sides finally agreed on an increase of 6.5 percent to be paid from August 1st. The degree was also adopted for the East German steel industry.
Concerted action against the wage-price spiral
In business and politics, higher wage demands are heating up the debate about an impending wage-price spiral. In order to counteract this, Chancellor Olaf Scholz invited employers, trade unions, scientists and politicians to a “concerted action” in Berlin at the beginning of July. In the format for which further meetings are planned, solutions to the dreaded scenario are to be developed.
The effect of the wage-price spiral occurs when strong wage increases are agreed in response to high inflation, and these in turn reinforce inflation.