German strikers target Berlin

The German capital is now in the sights of the strikers

Striking engineering workers in Germany have threatened to shift their action for higher pay to the country's capital Berlin.

Generally, the drop in production is quickly recovered through extra shifts and overtime after the strike ends

Thomas Hueck
economist
HypoVereinsbank

The threat came despite repeated calls for wage restraint from politicians and business leaders, who believe large pay increases could hurt the eurozone's biggest economy.

Opponents of the first major strike in Germany since the mid-1990s were given powerful ammunition when new statistics revealed that industrial output in Germany fell 0.8% in March.

And in another blow to hopes of a speedy German economic recovery, the finance ministry also revised its February industrial output figure of 0.9% growth downwards to 0.5%.

Recoverable loss

The engineering workers' union IG Metall insisted that its strikes should have a limited impact on overall economic output.

And both economists and industrialists said firms should be able to make up any lost ground.

It's obvious now these strikes will cost jobs

Dieter Hundt
Confederation of German Employers' Federation (BDA)

"Generally, the drop in production is quickly recovered through extra shifts and overtime after the strike ends" said HypoVereinsbank economist Thomas Hueck.

"It will be possible to make up this loss in the rest of the year," agreed a spokesman for the car maker DaimlerChrysler, which lost the production of 2,800 passenger cars when it was hit by strikes on Monday.

Strike spreads

The 2.7 million member IG Metall union ignored calls for restraint on Wednesday, pressing on with further strike action in the south-west of the country.

"We've called on 13,000 metalworkers in small and medium-sized engineering firms in [the state of] Baden-Wuerttemberg to strike today," said IG Metall spokesman Frank Stroh.

The union - which represents engineering, electronics and metal working staff - will next week move its series of one-day strikes to Berlin and the surrounding state of Brandenburg, IG Metall chief Klaus Zwickel said.

Miles apart

By the weekend, around 100,000 workers may have been involved in industrial action to back IG Metall's demand for a 6.5% pay rise.

The gap between the workers' demand and the employers' 3.3% pay rise offer remains difficult to bridge.

"We want a negotiated solution, but the employers must raise their offer or it makes no sense for us to sit around a table," IG Metall's deputy head, Juergen Peters in an interview with Hanover Neue Presse.

"It's obvious now these strikes will cost jobs in Baden-Wuerttemberg," the Confederation of German Employers' Federation (BDA) chief, Dieter Hundt, told Financial Times Deutschland.

IG Metall has suspended all strikes on Thursday because it is a public holiday in Germany, though the strikes are due to restart on Friday.