Germany to Raise Minimum Wage to €14.60 by 2027 Amid Economic Slowdown

Germany is set to gradually increase its statutory minimum wage to €14.60 per hour (approximately $17.11) by 2027, according to a proposal by the country’s minimum wage commission—a panel made up of representatives from both trade unions and employers.

The first step of the hike will take effect in January 2026, when the wage will rise from the current €12.82 to €13.90. This phased approach, however, falls short of the initial expectations set by the ruling coalition government, which had aimed for a more aggressive increase.

By 2027, full-time minimum wage earners in Germany can expect to receive monthly earnings close to €2,500—positioning Germany as the EU’s second-highest minimum wage country, just behind Luxembourg, which mandates €2,638 per month as of 2025 (Eurostat data).

German Labour Minister Baerbel Bas praised the agreement, describing it as proof that the country’s “social partnership works.” He also urged lawmakers to implement the change into law starting January 1, 2026.

This development comes amid mounting economic challenges. Germany, Europe’s largest economy, has faced two consecutive years of contraction, and the number of unemployed citizens has recently hit 3 million—the highest in a decade. The Ifo Institute’s latest employment barometer also indicates a more cautious hiring sentiment among German companies, reflecting continued uncertainty in the labor market.

As the wage hike proposal moves forward, questions remain about its potential impact on inflation, competitiveness, and job creation in an already fragile economy.