4th May 2016

French minister slams German 'wage-dumping'

  • Hamon said Merkel should 'play fair' on wages (Photo: PeterXIII)

A senior French minister launched a broadside at Angela Merkel on Wednesday (18 September), accusing the German government of seeking an unfair advantage by keeping domestic wages artificially low.

Speaking during an interview with BBC news, Benoit Hamon, France's social affairs minister, accused Germany of "pitting workers at seven euros against those who earn 10, 11 or 14 an hour," adding that he wanted to "play fair with an economic model that isn't based on a competition of who can pay workers the least."

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"I want Germany to have a social policy where competitiveness doesn't rely on jobs paying €400 a month," he remarked.

The comments by Hamon, who leads one of the more left-wing factions of Francois Hollande's socialist party, come just days before Germans go to the polls at the weekend.

Germany's opposition social democrat (SPD) include a national minimum wage of €8.50 per hour as part of their election platform.

However, although Merkel's government agreed on Wednesday to establish a minimum wage for workers in the stonemasonry sector, it has so far opposed a mandatory minimum wage, preferring companies and unions to negotiate wages on a sector-by-sector basis.

Twenty-one of the 28 countries in the EU already have a minimum wage.

Opinion polls give Angela Merkel's christian democrats a lead of between 10-15 percent over the SPD, but her centre-right coalition could yet be ousted, with the Free Democrat coalition partners languishing on around 5 percent.

Critics say that by keeping wage levels artificially low Germany makes it harder for other countries to compete on labour costs.

The European Commission, as well as the US government and the International Monetary Fund, is also keen for Berlin to increase wages to boost consumer spending in the bloc's largest economy and make it easier for other countries in the eurozone to export.

In April, Laszlo Andor, the EU executive's employment commissioner, warned that the eurozone would "drift apart" if Germany maintained its low wage levels and export surpluses.

For her part, Merkel has urged France to cut salary levels as part of a series of measures to cut labour market costs and increase competitiveness.

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