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German wages increase outpaces inflation in Q2

Xinhua, August 28, 2015 Adjust font size:

The growth of negotiated wages in Germany significantly outpaced the increase in consumer prices in the second quarter of 2015, boosting Germans' purchasing power which supported economic expansion, official data showed Friday.

Accounting for bonuses and other extra payments, workers in Germany received 3.1 percent higher wages in the second quarter than in the same period of previous year, data from German federal statistical office Destatis showed.

It was significantly higher than the annual inflation rate which stood at only 0.5 percent.

According to Destatis, employees in civil service enjoyed the biggest wage hikes. Compared to the previous year, their wages increased 4.0 percent. Wages of employees in health and social work sector rose by 3.7 percent, and those in financial and insurance sectors rose by 3.4 percent.

Higher wages and low inflation means German consumers gained more purchasing power during Q2 2015, with the German economy expanding 0.4 percent.

Market research institute GfK said earlier this month that conditions for a good consumer economy in Germany, such as employment, income and inflation, would remain favorable in the coming months. It expected private consumption to rise by 1.5 percent in 2015. Endit