Wages are increasing less and less rapidly due to economic uncertainty | Economy

This has to do with the significant wage increases that were agreed last year. The average wage increase then amounted to 7.1 percent, which is a historical high. Before the corona crisis, there was still an average wage increase of 2.5 percent. And that was high at the time.

Last month, a total of eighteen collective labor agreements were concluded for approximately 120,000 employees, according to provisional figures from the employers’ association AWVN. Wages rose most rapidly in education, construction, transport and the paper industry. On an annual basis, the average wage increase is approximately 6 percent.

“We see that wage increases have been lower since the summer of last year,” a spokesperson said. “Employers are more cautious because of the economic uncertainty. Companies in industry and chemicals, for example, are receiving fewer orders.”

In addition, many employees have already been significantly compensated for the loss of purchasing power due to high inflation. “Wages have already risen considerably and the unions are maintaining a lower limit during the negotiations. Moreover, the wage increase is still at a high level at 4.7 percent.”

The peak was reached last October when wages rose by an average of more than 8 percent. Employers had to dig deep into their pockets last year. The purchasing power of people in various sectors and companies has been under pressure for a long time due to high inflation.

Employees have difficulty paying their energy bills or run into problems at the end of the month. Last year, the unions focused on full price compensation at the many collective labor agreement tables. For this year, the FNV assumes a wage requirement of between 5 and 14 percent.

Economists from RaboResearch expect wage increases this year to be lower than in 2023. They assume that wages will rise by an average of 6 percent this year.