German steelworkers’ union wants 7% higher wages ahead of Reuters talks

FRANKFURT (Reuters) – The leadership of Germany’s steelworkers’ union, IG Metall, has told its members to demand a 7% wage increase in the upcoming round of negotiations, above the current rate of inflation.

IG Metall, Germany’s largest industrial union, said in a statement that regional delegations would decide on the union’s official wage demands on Friday.

IG Metall said the round of negotiations on behalf of 3.9 million workers will need to be led more because the companies have a strong back order.

The union added that inflation may have eased, but more wage increases are needed for workers to cope with higher prices.

The European Central Bank said this month it would keep a close eye on wages, after cutting interest rates for the first time since 2019, encouraged by inflation falling from 10% in 2022 to just above 2% in its latest target.

Further rate cuts are doubtful, however, as ECB policymakers have warned of strong price pressures and wage growth, likely to keep inflation above target until next year.

The decline in German consumer prices was 2.8% in May, from 2.4% in April.