German Trade Unions Demanding Big Pay Increases After Years of Restraint - by Sven Böll and Janko Tietz

German trade unions plan to demand big pay increases this year and look set to get their way. Economists say that after years of wage moderation, it is high time that German firms agreed to bigger hikes -- not least because this would help the entire European economy.

Frank Bsirske, the head of the Ver.di service workers' union, gets annoyed when he hears people say that Germany is doing pretty well. "That only applies to the well-off," he says angrily. "The gap between rich and poor has never been this wide, and never has the middle class felt this threatened." The union leader is even worried that social conflict could escalate.

His recipe against the erosion of society is hardly surprising: Wages have to go up, and by a significant amount, at that. In the current collective bargaining round, Ver.di is calling for a 6.5-percent pay increase -- the highest in years -- for German public sector employees.
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