Steel Industry Agreement: 3.0K Euro Bonus and 5.5% Wage Hike
Iron and steel workers in North Rhein-Westphalia, Bremen, and Lower Saxony celebrated a weekend agreement that promises an inflation compensation bonus worth 3,000 euros and a 5.5% wage hike starting January 1, 2025. The collective bargaining between employers and IG Metall, Germany's metalworkers' union, was confirmed in Düsseldorf, making it a powerful precedent for the steel industry.
The agreement also includes provisions for reduced work hours from 35 to 32 hours with partial wage compensation. Employees who require additional hours during peak demand can do so, adhering to overtime payment regulations. Coking plants, which will no longer be needed for hydrogen powered plants due to the planned transition towards climate neutrality, are covered by the job safeguard collective agreement.
The steel industry negotiations took 14 hours, marking the fifth round in Düsseldorf. Amidst a cooling labor market and varied economic factors, pay raises in the U.S. are projected to be between 3.5% to 3.9% in 2025, a notable slowdown compared to recent years.
Yet, the German steel industry sets the pace for change as Chancellor Olaf Scholz supports the transition to climate-neutral production using gas and hydrogen. This transformation, driven by customer demands for eco-friendly steel products within the automotive industry, could have significant implications for the global market. While the EU-Mercosur Agreement, aimed at promoting tariff reductions and sustainability commitments, has mixed feelings from EU countries, the German steel industry has much to gain.
In these challenging times, as the steel industry eyes its future, workers in North Rhein-Westphalia and other regions are finding hope and security in the decision made overnight in Düsseldorf.
