The German economy recorded another year of real wage growth in 2025, meaning a real increase in consumer purchasing power. According to data from the Federal Statistical Office, the growth in nominal wages significantly outpaced the inflation rate. This trend held in most federal states, including Bavaria and Lower Saxony, although the level of real incomes still remains below the record highs seen before the pandemic in 2019.
Real Wage Growth in 2025
Wages in Germany grew faster than prices, leading to an increase in consumer purchasing power for the second consecutive year since the outbreak of the inflation crisis.
Gap to 2019 Levels
Despite the increases, the real incomes of Germans have still not returned to the record levels seen before the pandemic, indicating an ongoing process of recovering economic losses.
Stability of the Tourism Sector
Wage growth translates into stable tourism results in Brandenburg and an increase of nearly 50,000 overnight stays in the Niederrhein region.
Data from the Federal Statistical Office (Destatis) for 2025 confirms a positive trend in the German economy: real wages have risen for the second consecutive year. This phenomenon results from the fact that the growth rate of nominal wages was higher than the rate of price increases, which directly translated into greater purchasing power for workers' wallets. Real wages grew particularly noticeably in states such as Bavaria, Thuringia, and Lower Saxony. In Bavaria, the local statistical office indicated that workers have significantly more real funds at their disposal than last year, which is a key signal of stabilization in private consumption amid previous inflationary turbulence. Despite these optimistic signals, experts note that German households have not yet fully recovered the losses from the 2021–2023 period. The current level of real wages is still below the threshold from 2019, the period before the COVID-19 pandemic and the energy crisis. The German labor market is traditionally characterized by a strong role for collective bargaining agreements, which in the last two years have focused on inflation bonuses and significant base wage increases to compensate for the loss of money's value. Local analyses indicate some variation: while growth was stable in Lower Saxony and Bremen, other regions, such as Saxony, recorded a minimal decline in average working hours, which may affect the overall wage mass despite higher hourly rates. Interesting data also came from the tourism sector, which is an important barometer of consumer sentiment. In Brandenburg, this industry remains stable, and travel outside the peak summer season is becoming increasingly popular. In North Rhine-Westphalia, specifically in the Niederrhein region, the number of overnight stays increased by nearly 50,000 year-on-year, confirming that increased purchasing power translates into spending on recreation. Nevertheless, the situation is not uniform for all occupational groups—while most sectors gained, some service industries still struggle with operational costs limiting room for further wage maneuvers. „Die Reallöhne in Deutschland sind im Jahr 2025 das zweite Jahr in Folge gestiegen, nachdem sie zuvor durch die hohe Inflation belastet worden waren.” (Real wages in Germany rose in 2025 for the second year in a row, after having previously been burdened by high inflation.) — Destatis In Thuringia, particular attention was paid to working hours—statistics show how much residents of this region actually work compared to the national average. The observed decline in working hours in some eastern states may be a signal of structural changes or workers' pursuit of a better work-life balance while maintaining higher wage rates. In summary, 2025 was a year of recovery for the German worker, though the path back to pre-crisis prosperity levels remains long.