WIESBADEN (dpa-AFX) - The approximately 930,000 employees in the German construction industry are to receive more money. The negotiating committee of the IG BAU trade union agreed to the arbitrator's proposal on Friday, according to which incomes are to be increased by 250 euros per month as of May 1, 2024. Eleven months later, a further 4.15 percent is to be added in the west and 4.95 percent in the east. The training allowance in the first year of training is to be €1080 in both East and West, with a duration of two years. "We grudgingly accept the agreement," said Robert Feiger, Chairman of IG BAU. The ball is now in the employers' court.

According to the Central Association of the German Construction Industry, the member associations of the employers' collective bargaining association will now vote until May 3, 2024. If the employers do not agree to the proposal, "then, of course, industrial action is on the cards. The mood among construction workers is highly explosive," warned Feiger. The head of the union intends to recommend that the federal collective bargaining commission of the union approve the arbitrator's decision. "We are assuming responsibility for society as a whole, because there is a traffic jam in construction in Germany."

IG BAU had previously declared the wage negotiations to have failed after three inconclusive rounds. This meant that a contractually agreed arbitration procedure was canceled. The former President of the Federal Social Court, Rainer Schlegel, had acted as mediator in the talks in Wiesbaden.

IG BAU had demanded 500 euros more in wages, salaries and training allowances per month for a period of one year. The employers from the industry associations ZDB and HDB had offered two salary increases of 3.3 percent for this year and 3.2 percent for next year. They had referred to the crisis, particularly in residential construction, and accused the union of completely ignoring it.

The construction industry is one of the largest employers in Germany and an important pillar of the German economy with a turnover of around 162 billion euros in 2023, according to the construction industry association ZDB. The sector had supported the economy for years during the real estate boom, but has now become a problem child due to the crisis in residential construction.

Due to the rise in interest rates and expensive materials, residential construction is in crisis and the German government's new construction target of 400,000 new homes per year is out of reach. According to estimates by DZ Bank, the number of annual completions could fall to 200,000 apartments by 2025. Building permits have been on a downward trend for many months, plummeting by a good 18 percent in February compared to the same month last year. The Ifo Institute recently reported that the mood in residential construction remains tense. One in five residential construction companies reported cancellations./mar/als/DP/stw