The Merz government signed off on the decision on 29 October 2025—an unexpected step given the country's deep economic troubles. Yet the independent commission that issued the recommendation argues that the increase should boost household spending and, in turn, support overall economic growth.
Starting 1 January 2026, Germany's minimum wage will rise to €13.90 gross per hour, up from the current €12.82. A second increase will take effect on 1 January 2027, raising the hourly rate to €14.60. The independent commission, which met in June 2025 and brings together representatives of both employers and employees, proposed a two-year adjustment. In total, this represents a 13.9% increase over the past two years.
Germany only introduced a national minimum wage in 2015 under Angela Merkel, at €8.50 per hour. It rose significantly under the Scholz government, with a cumulative increase of around 22%.
Foreign workers will benefit from the higher minimum wage in exactly the same way as German employees. Today, roughly 6 million people in Germany earn the minimum wage. The upcoming increases are expected to cost €2.2 billion in 2026 and €3.4 billion in 2027.
According to the government, the wage hike should not lead to higher unemployment. Spreading the adjustment over two years is intended to give businesses enough time to absorb the additional labor costs.
