The German economy recorded a significant 1.9% increase in real wages in 2025, marking a tangible boost to citizens' purchasing power after years of crisis. Simultaneously, Equal Pay Day observances highlight structural inequalities in earnings between women and men. While the gap stands at 21.8% in France's private sector, Germany grapples with an 18% gap, sparking debate about systemic barriers to women's career advancement.
Increase in Purchasing Power
German real wages grew by 1.9% in 2025 thanks to higher nominal wages and lower inflation.
Persistent Gender Pay Gap
Women in Germany and France still earn significantly less than men, prompting calls for systemic reforms.
Distance to 2019 Levels
Despite growth, Germans' real incomes remain nearly 2% lower than before the crises of 2020-2022.
The German Federal Statistical Office confirmed that 2025 brought a breakthrough in wage dynamics. Nominal wages rose by 5.1%, which, coupled with inflation slowing to 3.1%, allowed for a real income increase of 1.9%. Positive trends were noted in all federal states, with particular emphasis on Bavaria, Lower Saxony, and Thuringia. Despite this success, statisticians temper optimism, pointing out that the real wage level has still not returned to the record highs of 2019, remaining nearly 2% lower than before the pandemic period and the sharp rise in energy prices. Since 2021, eurozone countries have struggled with record inflation caused by supply chain disruptions and the energy crisis following Russia's aggression against Ukraine, leading to the strongest decline in real wages in Germany's post-war history. Parallel to the macroeconomic data, public attention in Europe has focused on the issue of the gender pay gap. The latest reports from the French institute Insee indicate that in the private sector, women earn 21.8% less than men. Although this gap has slightly narrowed, the pace of change has slowed compared to previous years. In Germany, the situation is similar – the difference is about 18%, placing the country below the EU average of 13%. „Der Anstieg der Reallöhne im Jahr 2025 resultiert aus deutlichen Tarifabschlüssen und den inflationsausgleichenden Sonderzahlungen.” (The increase in real wages in 2025 results from significant collective bargaining agreements and inflation-compensating special payments.) — Destatis Experts emphasize that low labor force participation of women in certain sectors and the dominance of men in managerial positions are the main causes of these disparities. In Germany, the debate surrounding "Equal Pay Day" focuses on the postulate of abolishing individual salary negotiations in favor of transparent pay scales, which would put an end to arbitrariness in remuneration. Lawyers also point to the problem of the so-called motherhood penalty, which manifests as the necessity to work part-time coupled with a lack of sufficient childcare infrastructure. 21.8% — is the gender pay gap in the French private sector Prospects for 2026 remain moderately optimistic, provided the pace of price growth remains low. However, a return to full pre-crisis purchasing power will require maintaining a high rate of wage growth in key industrial and service sectors.