Union demands €100bn stimulus investment

The powerful IG Metall union called on the federal government on Sunday to put €100 billion into a future investment programme that would bolster technological innovation by German industry.

Union demands €100bn stimulus investment
Photo: DPA

Making his demand in an interview with Sunday’s edition of the Weser Kurier newspaper, the union’s chief, Berthold Huber, said the investment would better equip Germany to pull out of the global economic downturn.

“Do we want to support good businesses, or give up on them because they have a liquidity bottleneck at the moment and can get no credit or only much too expensive credit?”

To ensure the return of growth and employment after the crisis, core industries such as the metal and electronics sectors had to be supported, he said.

An investment programme was therefore urgently needed.

“The financing can’t be a problem,” Huber said, pointing out that the bank rescue packages had clearly cost more than what he was calling for.

The economic stimulus packages the government had previously put in place – totalling about €80 billion plus €100 billion in loan funding guarantees – were not enough, Huber said.

The stimulus legislation passed on Friday by the upper house, the Bundesrat, was politically motived, particularly the “billions worth of tax relief for the rich,” Huber said.

IG Metall, which is one of Germany’s biggest and most powerful unions with 2.4 million members, represents both blue and white-collar workers in a wide range of industries related to metal.

Huber also said the union would exercise restraint in wage negotiations with metal industry firms due to start in the spring, provided companies gave credible guarantees that workers‘ jobs were be secure.

“Our members expect of us that we will above all keep their jobs safe,” he said.

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German steelworkers agree 6.5 percent pay hike after strike

Tens of thousands of steel workers in western Germany will get a 6.5-percent pay hike this year - the biggest jump in three decades - in a settlement that could set the tone for industry as inflation soars.

German steelworkers agree 6.5 percent pay hike after strike

The agreed increase would come into effect “from August 1st”, the IG Metall union in the region of North Rhine-Westphalia said in a statement Wednesday.

The 68,000 steelworkers in the industrial region would also receive a one-off payment of 500 euros for the months of June and July, the union said.

The outcome of the negotiations was “the biggest increase in wages in the steel industry in percentage terms in 30 years,” said IG Metall boss, Joerg Hofmann.

Germany’s largest union, IG Metall launched a strike action at steelworks in the west in May after management failed to meet its demands for an 8.2 percent pay increase.

On Thursday at the peak of the movement, around 16,000 workers across 50 firms downed tools, the union said.

READ ALSO: Should foreign workers join a German union?

“Rising inflation” and the “good economic situation” of the steel industry were the basis for IG Metall’s demands.

Consumer prices rose at a 7.9-percent rate in Germany in May, a record for the country since reunification in 1990 driven by the outbreak of the war in Ukraine.

The smaller number of steelworkers in the east of Germany, who are also seeking an 8.2 percent pay boost, have yet to reach their own agreement.

Negotiations are currently taking place in a number of sectors. In the textile industry, 12,000 workers in the east of Germany sealed a 5.6 percent pay increase at the beginning of May.

Meanwhile, negotiations covering the auto industry, and mechanical and electrical engineering will begin in November.

Despite the agreed rise the onus was still on government to relieve the pressure on workers form rising prices “in the coming months”, IG Metall boss Hofmann said.

Significant wage demands have prompted concerns of a wage-price spiral, where rising pay sustains higher inflation.

The European Central Bank last week said it would raise its interest rates for the first time in over a decade this July as it seeks to stamp out price rises.