Minimum Wage

The Good, the Bad and the Ugly

Working for more than minimum wage: German Labor Minister Andrea Nahles. Source: DPA
Working for more than minimum wage: German Labor Minister Andrea Nahles.
  • Why it matters

    Why it matters

    Starting January 1, 2015, Germany has a national minimum wage of €8.50, or $10.20, per hour. But there are many exceptions.

  • Facts


    • German wages have traditionally been determined by sector-wide deals between employers and trade unions.
    • Many fear the minimum wage will lead to cuts in low-paid jobs.
    • It will not apply to the long-term unemployed, traineeships and most internships.
  • Audio


  • Pdf

After a year of contentious debate, the biggest change to Germany’s labor market in decades is here: A national minimum wage of €8.50 per hour. There will be winners and losers. Opponents fear a mass wave of job cuts because of more expensive labor costs; supporters believe many workers will finally earn a living wage. The true impact will only be seen in several years when Chancellor Angela Merkel’s government is no longer in office. Five people said what it means for them.


The Customs Agent

Susanne Peters (name changed) wears a pistol on her hip, but she carries her most dangerous weapon in her hand: a clipboard full of official forms.

The customs agent and her colleagues are hunting for illegal construction workers on a nasty morning in the eastern German city of Potsdam near Berlin. The building sector in Germany is notorious for its dodgy wage practices, but there are plenty of black sheep in the restaurant, logistics, and cleaning industries, as well as the country’s legal sex trade. Some 6,500 customs agents are now responsible for enforcing Germany’s minimum wage, which applies to around 3.7 million workers. The government has promised 1,600 new agents in the coming years, meaning Ms. Peters will have to focus on the worst offenders. Does she have any sympathy for those people forced to work under conditions not supposed to exist in Germany’s much vaunted social market economy?

“I have no sympathy when I’m being lied to. It frustrates me,” she says. “I think more about those honest workers and their employers who are suffering because of it.”

Want to keep reading?

Subscribe now or log in to read our coverage of Europe’s leading economy.