'Far too low': How millions of workers in Germany are earning less than €14 per hour

Imogen Goodman
Imogen Goodman - [email protected]
'Far too low': How millions of workers in Germany are earning less than €14 per hour
A restaurant employee cleans benches in Baden-Württemberg. Photo: picture alliance / Sebastian Gollnow/dpa | Sebastian Gollnow

Germany is known for being a country of well-paid workers. But new statistics from the government reveal that more than eight million people are taking home less than €14 per hour, prompting fresh calls to raise the minimum wage.


"Good work deserves a decent wage - that's just about respect," wrote the centre-left Social Democrats (SPD) in their election campaign back in 2021. 

When Olaf Scholz's party entered government as the largest partner in the traffic-light coalition, one of their flagship pledges was to bump up the minimum wage to €12 per hour - a major increase from the previous €10.45.

The SPD kept their promise and on October 1st, 2022, the €12-per-hour minimum wage came into force in Germany. 

Just 18 months later, however, there are once again rumblings of dissatisfaction as left-wing parties call for another hike in wages for the lowest paid in Germany.

What do the lowest workers earn in Germany - and where do they work?

Currently, more than eight million workers - amounting to around 10 percent of the population - earn less than €14 per hour in Germany.

According to the Labour Ministry, around 8.4 million people were employed at hourly wages below €14 as of April 2023, with around 7.1 million of them in the western states. 

The proportion of these workers is particularly high in the hospitality industry, with 65.8 percent of workers in cafes, bars and restaurants earning less than €14 per hour. According to the latest data, 1.1 million employees in this industry fell below the €14 threshold. 


In retail, the number of workers earning below €14 per hour was even higher at 1.6 million. Meanwhile, in the service sector, 45 percent of the some 1.46 million workers fell into this bracket. 

The data on low earners was released in response to a parliamentary question from the left-wing Linke party and was first reported on by Spiegel on Monday. 

Following an increase at the start of the year, the current minimum wage is set at €12.41. However, €14 is a significant benchmark because it represents 60 percent of the median wage in Germany. According to an EU directive, the national minimum wage should be no less than this figure. 

READ ALSO: Minimum wage violations on the rise in Germany - Are you getting paid enough?

Why is the minimum wage such a heated issue?

Workers in Germany are in many ways facing a perfect storm right now. 

In the months it took for the SPD to bring in the €12 minimum wage, an energy crisis brought on by Russia's war on Ukraine had sent prices spiralling in Germany.

In 2022, the cost of living rose by a staggering 6.9 percent compared to the previous year, dropping off just slightly to 5.9 percent in 2023. 

Though inflation has tailed off in recent months, employees are still facing prices of everyday goods that are in some cases double what they were just a few years ago.

Groceries lie on the conveyor belt at the checkout in a supermarket in Bavaria.

Groceries lie on the conveyor belt at the checkout in a supermarket in Bavaria. Photo: picture alliance/dpa | Sven Hoppe

At the same time, economic uncertainty has made employers reluctant to increase wages, and those on minimum wage have only had modest pay increases over the past few years.

Last year in June, Germany's minimum wage commission proposed an increase of just 41 cents each year for this year and next, bringing the minimum wage up to €12.41 at the start of January 2024 and up to €12.82 in January 2025. 


At the time, the decision was described as "scandalous" by labour experts and trade unions, who slammed the fact that the tiny increase would amount to a real-terms cut in wages for the lowest earners. 

There was also tough criticism over the fact that the decision by the minimum wage commission had not been unanimous.

READ ALSO: Why Germany's proposed minimum wage increase has been called a 'scandal'

How is the minimum wage decided in Germany?

Since the statutory minimum wage was established in Germany back in 2005, a committee called the Minimum Wage Commission (Mindestlohnkommission) has been responsible for making recommendations on how high it should be. 

This committee consists of three employer representatives and three worker representatives who vote on the proposed changes, as well as two government-appointed advisors who don't have voting rights.

Every two years, the commission decides on adjustments to the minimum wage for the next two years, and these proposals are then approved by the government. 


Controversially, the latest proposals from the Minimum Wage Commission didn't receive unanimous approval, with the employee representatives on the panel claiming to have been outvoted.

This has recently led to calls from SPD co-leader Saskia Esken for the rules to be changed so that decisions by the commission can only be reached by consensus. 

READ ALSO: What are Germany's top-paying jobs?

What proposals are on the table for the minimum wage?

Though the SPD haven't united on a figure for the coming years, numerous voices in the party have spoken out in favour of a significant increase for low-paid workers.

Speaking to RND on Wednesday, Esken described the current increases as "far too low" and stated that the next minimum wage "must definitely be high enough to ensure that single people can live on it without falling into poverty if they have a full-time job". 

This echoes calls from SPD co-leader Lars Klingbeil for a "significant increase" in the minimum wage next time around.

SPD co-leader Lars Klingbeil speaks at an EU election event in Hamburg. SPD co-leader Lars Klingbeil speaks at an EU election event in Hamburg. Photo: picture alliance / Sebastian Gollnow/dpa | Sebastian Gollnow

Going one step further, Petra Köpping, the leading SPD candidate in Saxony, suggested a minimum wage of at least €15 per hour.

Meanwhile, the leftwing Linke party wants the government to change the law so that the national minimum wage can't fall below 60 percent of the median salary, which currently amounts to €14 per hour.

An EU directive on fair wages that must be implemented in Germany by November 15th, 2024, suggests that the minimum wage should be set at least 60 percent of the median salary, and that collective bargaining agreements should cover at least 80 percent of the workforce. 


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