Increase of the Statutory Minimum Wage to 12 Euros. Statement of the IAB on the hearing of associations of the Federal Ministry of Labor and Social Affairs on the draft of a law to increase the protection by the statutory minimum wage (MiLoEG) on 2.2.2022

Abstract

"The IAB was asked to comment on the draft bill (of the Federal Ministry of Labor and Social Affairs) to increase employee protection by the statutory minimum wage (Mindestlohnerhöhungsgesetz– MiLoEG). The law intends to implement the adjustment of the minimum wage increase to a gross wage of 12 Euros per hour of work by October 1, 2022, as agreed in the coalition agreement. The comment addresses the background to the minimum wage increase, the depth of intervention of the minimum wage, and potential wage and employment effects. In summary, the minimum wage increase to 12 Euros has a large bite and significant wage increases can be expected. However, it remains to be seen to what extent the expected hourly wage increase will be reflected in monthly labor income, in a reduction in ALG II receipt, and in a reduced risk of poverty, as well as the magnitude of potential employment effects. Even though the empirical literature on the introduction of the minimum wage and recent macroeconomic studies point to positive consequences regarding developments of the labor market, it is not possible to derive any reliable forecasts of the effects of the planned minimum wage increase." (Author's abstract, IAB-Doku) ((en))

Cite article

Bossler, M. (2022): Erhöhung des gesetzlichen Mindestlohns auf 12 Euro. Stellungnahme des IAB zur Verbändeanhörung des Bundesministeriums für Arbeit und Soziales zum Entwurf eines Gesetzes zur Erhöhung des Schutzes durch den gesetzlichen Mindestlohn (MiLoEG) am 2.2.2022. (IAB-Stellungnahme 01/2022), Nürnberg, 11 p. DOI:10.48720/IAB.SN.2201