Germany’s transport system was paralyzed on Monday by a one-day warning strike that halted national and local rail services, causing misery for millions of commuters and severely disrupting freight traffic in Europe’s largest economy.
The 24-hour strike, which began at midnight Sunday, has been called by powerful service sector union Verdi and EVG, which represents rail workers. They say employers are ignoring the implications for their members of the escalating cost of living crisis.
“What is really stressing public sector employees, and indeed all middle-income groups, are the massive increases in gas, electricity and food prices,” said Frank Wernke, Verdi president. Household energy prices in Germany rose 32 percent in the year to February, while food prices rose 22 percent, according to figures from the Federal Statistical Office.
Employers say the strikes are putting pressure on ongoing wage negotiations, with German airport union ADV calling the strike an “unprecedented escalation”.
“It is not acceptable for Verdi to implement its wage demands at the expense of the entire German economy,” said Markus Gerger, president of the German Federation of Small and Medium-Sized Enterprises.
The demand for higher wages is also causing problems for the ECB’s wage-setters, raising concerns about the risk of a self-sustaining spiral of higher wages and prices.
Hourly labor costs in the eurozone surpassed those in the United States in the year to the fourth quarter of 2022, when they rose by 5.7 percent — the fastest rate since such data began being collected for the single currency bloc in 2010.
All domestic flights have been canceled as some of Germany’s largest airports closed their doors, grounding 380,000 passengers. All long-distance, regional and local trains operated by Deutsche Bahn were also affected, while public transport was halted in seven of Germany’s 16 federal regions.
The EVG said long-distance, regional and local trains operated by Deutsche Bahn and other railways would also stop.
EVG and Verdi, which are demanding an increase of 10.5 percent for public sector workers, are using the strike to ramp up pressure during wage negotiations with employers. Talks between unions and employers’ representatives in the public sector continue on Monday.
“People are tired,” Wernicke told German radio, especially on public transport and in airports where they don’t earn much. All they hear from employers are warm words rather than a solution that takes inflation into account.” German train drivers earn around €40,000 a year on average, while airport baggage workers earn around €30,000, according to recruitment website talent.com.
Monday’s strikes underscore how workers across Europe are stepping up their demands for higher wages to compensate for the sharp rise in the cost of living. Inflation in the eurozone was 8.5 per cent in the year to February.
German inflation is expected to rise from 9.3 percent in February to 9.4 percent in March when the latest pricing figures are released on Thursday.
European Central Bank President Christine Lagarde warned last week of the dangers of a “reciprocal dynamic” between firms and workers that raises profit margins and wages, adding to price pressures as both groups try to avoid a blow from rising inflation.
The European Central Bank raised interest rates six times by a total of 3.5 percentage points, but Joachim Nagel, the president of the German central bank, told the Financial Times last week that more was needed, adding: “If we are to tame this stubborn inflation, we will have to be more stubborn.” “.