Germany Increases Minimum Wage to €13.90 in Two-Stage Hike Through 2027
The German government approved an unprecedented 8.4% minimum wage increase starting January 2026, followed by a second rise to €14.60 in January 2027. The change will directly affect around 6.6 million workers but raises concerns about job losses in cost-sensitive sectors.
The German government has approved the largest minimum wage increase in the country's history, with wages rising in two stages over 2026 and 2027. On January 1, 2026, the national minimum wage increased from €12.82 per hour to €13.90 per hour; on January 1, 2027, it will rise again to €14.60 per hour.
Impact and Concerns
The decision stems from a recommendation by the Minimum Wage Commission—an independent body made up of representatives of employees and employers—and subsequent approval by the German federal government. According to a recent report by the Ifo Institute, more than one in five companies surveyed expects to reduce jobs in response to higher labor costs, while nearly one third of the firms interviewed plan to cut investments in the coming years. However, Labour Minister Bärbel Bas (SPD) said that "millions of employees will receive noticeably more for their work, and companies can responsibly spread the rising costs over two years."
What This Means for Foreign Workers
If you earn at or near minimum wage in Germany, your gross hourly pay has risen substantially—a win for service-sector workers and apprentices. However, this increase may accelerate automation in low-skill roles and could tighten hiring in hospitality, retail, and domestic care sectors. Highly skilled workers on Blue Cards or Chancenkarte visas are largely insulated from this pressure, as they typically earn well above minimum thresholds. Entry-level foreign workers should be aware that some employers may shift toward part-time or trial arrangements to manage costs.
Sources
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