Representatives of trade unions, the left and the Greens are calling for a minimum wage of 15 euros. If this happens, prices in restaurants and at the hairdresser will rise. The increase would be another nail in the coffin for German wine and German strawberries.
The Verdi union, the Greens in the Bundestag and representatives of the Left have spoken out in favor of increasing the minimum wage to 15 euros per hour. SPD politician Stephan Weil said on “Markus Lanz”: “If we were to raise the minimum wage to a reasonably appropriate level, then many questions about social benefits would then be completely different.” Verdi boss Frank Werneke recently told the editorial network Germany, according to the EU directive, the minimum wage should be 60 percent of the median income, i.e. just over 14 euros. Since average wages will continue to rise, a minimum wage of 15 euros an hour will be necessary in 2026. On the employer side, Oliver Barta, managing director of Unternehmer Baden-Württemberg (UBW), has now warned of an increase.
The following seven points explain what a minimum wage of 15 euros means for your wallet and why Verdi boss Werneke is misinterpreting the EU directive:
According to the Federal Statistical Office, around 8.4 million people in Germany currently receive wages of less than 14 euros per hour. A higher minimum wage drives up prices, especially in industries that need a lot of staff but pay low wages. This has two consequences:
1. Companies stop operations
“Viticulture is in the deepest crisis in decades,” said farmer president Joachim Rukwied to the “Neue Osnabrücker Zeitung” in mid-April. He spoke of hectares of vineyards being cleared “because it is no longer worth it”. The same applies to all agricultural sectors, which do their work primarily by hand rather than by machine. That’s why asparagus is so expensive and why German strawberries can’t keep up with Spanish ones in terms of price.
If these industries reduce or stop their production in Germany, imported goods from abroad take their place. This is likely to become slightly more expensive due to increasing demand.
2. Companies increase prices
Some personnel-intensive sectors with low salaries have to remain in Germany despite the higher minimum wage, such as services. The hairdresser can only cut his hair on site. These companies are usually likely to increase their prices to compensate for wage increases.
This also applies, among other things, to building cleaning, chimney sweeps and security services.
A higher minimum wage drives up prices particularly in eastern Germany: a higher proportion of the population there receives the minimum wage than in western Germany.
The same applies to most low-wage jobs.
A minimum wage of 15 euros has little impact on expensive metropolitan areas: most employees there earn more anyway. Otherwise they wouldn’t be able to afford the apartments.
Nobody can calculate exactly how a minimum wage of 15 euros affects prices because some employees in Germany are exempt from the minimum wage: different rules apply to trainees, the long-term unemployed and some interns. A hairdresser who employs many of these people has to increase his prices less than a hairdresser who hardly employs any of these groups.
Nevertheless, some guidelines:
A minimum wage of 15 euros does not make going to the hairdresser more expensive across Germany. At the same time, it eliminates the last chances for cheap haircuts.
Consumers in all sectors that already pay above the minimum wage do not expect any increases in prices. In the construction industry, for example, trained skilled workers receive at least 22.10 euros per hour. Accordingly, a higher minimum wage does not increase construction costs.
Many other sectors have negotiated minimum wages that are above 15 euros. According to the tariff, even untrained nursing staff receive at least 15.50 euros. If a home pays according to the tariff, the increase does not affect the prices.
According to current law, the minimum wage does not have to increase in 2026. According to the Minimum Wage Act, the Minimum Wage Commission made up of representatives from trade unions and employers decides on the minimum wage, which then becomes binding by ordinance. It can take politicians’ wishes into account, but it doesn’t have to.
The Left calls for the “EU minimum wage directive to be implemented”, Verdi boss Werneke says something similar. But both mislead voters: the EU directive only gives examples according to which member states can calculate their minimum wages, for example setting the level of the “net minimum wage at 50 percent or 60 percent of the net average wage”. It does not specify any obligation and mentions the number 60 percent as one of many.
The Left doesn’t even say whether its 60 percent demand refers to gross wages or net wages. That’s about as inaccurate as if an airline doesn’t tell you whether it means the city in Russia or the city in Florida before taking off for St. Petersburg.
The minimum wage debate is also about the influence of politics on the development of minimum wages. When setting the figure for 2025, the independent chairwoman of the Minimum Wage Commission voted for the first time with employers against the German Trade Union Confederation’s proposal, which had called for at least 13.50 euros, and thus ensured the 12.81 euros that have now been decided.
Representatives of trade unions, the Greens, the Left and the SPD consider the decision to be too low. They therefore want to give politicians influence on wage setting, for example through a one-off statutory increase to 14 or 15 euros.