German Unions Want Payback

Cammy Corrigan
by Cammy Corrigan

German media calls it the “second economic miracle.” The German industry is hitting on all cylinders, a lot driven by exports. Europe’s biggest economy is officially forecast to expand by 3.4 percent this year, equal to the rate of 2006 and the highest since German reunification in 1990. When the recession/credit crunch hit a couple of years ago, the mantra from management to the unions was quite clear. “We need concessions to keep the company competitive and prevent going under.” Unions gave the concessions and life went on. But now, the climate is different. Volkswagen announced massive profits and Ford are also rolling in it. Well, if things are that good… ?

Global Nation reports that German workers are looking for payback now that the economy is getting back on its feet and profits are growing. “Workers helped overcome the crisis. They now want a fair share of the growth,” said a union statement. IG Metall has called for demonstrations to press its demands. Some companies have started to issue pay raises before this gets out of control. Bosch said that it would raise pay for 85,000 workers and quickly afterwards, Audi said they’d issues pay raises also. Porsche is also making preparations to make pay rises and pressure is rising at Daimler to follow suit. Even Ford is planning to instigate a wage increase. But pay raises are only half the picture. “Growth will only be self-sustaining when people have fixed contract and can live on their wages, not with an army of poorly-paid workers,” said IG Metall Vice-President Detlef Wetzel. Maybe it’s going to get to a point where companies announce their profits in private to their shareholders. Just to keep it from the unions…? [ED: Tough to do when the unions sit on the board.They are first to know.]

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