German Union to Ask for More than 6.5% Salary Hike

Cite inflation as reason

German trade union IG Metall said on July 11 it would ask for salary increases this year of more than the 6.5% demanded in 2007 because of inflation. "(This time) 6.5% will not be enough. The economy is doing well but rent and energy costs keep going up," union boss Berthold Huber told ZDF television.

The European Central Bank has consistently urged moderation in wage negotiations to avoid creating an inflationary spiral that would be sparked by big increases in salaries.

IG Metall last year asked for increases of 6.5% for the metal industry's 3.4 million workers and in the end obtained 4.1% and an exceptional bonus of 400 euros (US$636).

In February, employers agreed to a further 1.7%.

German unions are increasingly raising the bar when it comes to salary negotiations following several years of moderation in which the economy showed strong growth but workers' buying power was undermined by rising inflation. Some have asked for increases of close to 10%.

Copyright Agence France-Presse, 2008

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