Germany’s workers are in the strongest position in 30 years

AHIGHLY SKILLEDING workforce, harmonious labour relations and restrained wage growth: all have long underpinned Germany’s economic success. But, as the recovery from the ravages of covid-19 continues, the three pillars are looking wobbly. A shortage of skilled workers is becoming more acute. Pay is rising against the backdrop of higher inflation. And some disgruntled unions are even threatening to strike.Average wages in Germany rose by 5.5% in the second quarter, compared with the previous year. That may in part reflect a base effect: pay fell by 4% in the same period in 2020, when the economic shock from the pandemic hit. Still, workers today are in their strongest position in 30 years, says Gabriel Felbermayr of the Kiel Institute for the World Economy, a think-tank. Bosses are chasing after skilled staff in particular. Automation and migration cannot make up the shortfall, says Carsten Brzeski of , a bank.