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Germany – Pay agreements not “uneconomical”, says Randstad

01 May 2013

Despite employer organisations in Germany having raised concerns over new equal pay agreements which are increasing wages for agency workers, staffing firm Randstad has seen little impact on client orders.

A number of collective agreements in large industries have recently raised pay rates for agency workers and more surcharges are expected to come this year. While ManpowerGroup last year warned of major job losses, rival Randstad is less worried.

Andrea Dauch, regional director at Randstad Germany, told Stuttgarter Zeitung that the surcharges in the industry have helped to improve the image of staffing companies. “With the wage agreements there has been a new credibility [for staffing firms]. We definitely see more advantages than disadvantages,” she said.

Politicians, not least labour minister Ursula Von der Leyen, have long urged recruiters to increase pay. The media regularly picks up on ‘black sheep’ in the industry, and Ms Dauch said the wage increases play a significant part in improving the image of the staffing industry. “It was important that something happened. Polish and Czech staffing companies have entered the market through the EU so we are grateful for new rules.”

She said the surcharges did not make the staffing industry uneconomical. “Temporary staffing remains a strategic resort. We are not used to hire cheap labour.” Although Ms Dauch said that costs had risen, client companies are still relying on staffing services. “We do not experience a reduction in client orders,” she said.

But market conditions in Germany have weakened as Randstad last week reported that first-quarter, revenue in the country dropped by -4%. Yet, the firm said it benefitted directly from the wage agreements which, it said, improved pricing levels.


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