Germany – Significant increase in minimum wage

The Minimum Wage Commission today proposed raising the minimum wage in two steps to €14.60 by the beginning of 2027.

Dr Ralph Solveen

Commerzbank Economic Research

06/27/2025

This is less than the target set in the coalition agreement. However, the minimum wage would again increase more sharply than collectively agreed wages. This is likely to raise wage costs, thereby pushing up inflation and, at the same time, worsening the long-term prospects of low-skilled workers on the labor market.

Minimum wage to rise to €14.60 at the beginning of 2027 ...

The Minimum Wage Commission today proposed raising the minimum wage in two steps over the next two years: to €13.90 per hour at the beginning of 2026 and to €14.60 per hour at the beginning of 2027. So far, this is only a proposal that still has to be implemented by the Federal Ministry of Labor. However, since the decision was apparently unanimous in the commission, meaning that the union representatives also agreed, this is likely to be a formality, even though the SPD had been calling for a minimum wage of €15 until recently.

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