The union is demanding the wage hike for the industry’s 900,000 workers and an increase in the minimum wage in eastern Germany. Over the past decade, union officials say, construction companies have extended nonunion operations and hired workers from other countries at wages substantially lower than those won by the union. Today, less than half of the industry’s workforce belongs to the union.

The labor action initially focused in northern Germany. However, more construction sites are targeted for strikes in other parts of the country each day an agreement with the bosses is not reached. Union officials say the labor action will spread to southern Germany June 19 and nationwide by June 24 if negotiations do not resume.

"We’re going to expand the strike every day as long as they refuse to make a new offer," said IG Bau leader Klaus Wiesehuegel.

The construction bosses have called the strike "irresponsible," according to CNN. They offered a 3 percent hike beginning in September and a one-time lump sum payment of 100 euros (US$96) in August.

German capitalist economists and the big-business media are howling that a prolonged strike would endanger the country’s weak economic recovery, estimating that it could cost the industry $18 million a day. They warned that it would accelerate more job losses, noting that 500,000 construction jobs have been slashed since 1995.

"The economic damage is going to be massive," said Michael Knipper, managing director of the construction employers association.

"Too high wage settlements show up quickly in higher unemployment and a temporary jump in inflation," said Hypo-Vereinsbank economist Thomas Hueck.

Profit margins have sagged in the construction industry, putting the brakes on the country’s economy, which has been in a recession for the past six months. There have been a rising number of bankruptcies, 32,000 in 2001, a 14 percent increase from the previous year. The analysis firm Creditreform estimated there could be up to 40,000 bankrupt companies this year.

Several major companies have gone belly-up, including the construction giant Philipp Holzmann AG, paper company Herlitz, and aircraft manufacturer Fairchild Dornier.

The jobless rate in Germany is 8.1 percent, the fifth highest among countries in the European Union (EU). It is already over the 4 million mark, although Chancellor Gerhard Schroeder promised it would be well below 3.5 million by election time in September. According to the Federal Labor Office, unemployment rose by 60,000 in May, its sharpest increase in five years.

Despite the country’s economic stagnation and pressure from the bosses, the construction workers voted 98 percent in favor of putting down their tools. They pointed to the four percent pay raise negotiated for members in the IG Metall union to press their demands for the pay hike.

"After a prolonged period of economic stagnation, German workers are increasingly skeptical of government and employers’ argument that wage moderation is the key to recovery," noted a BBC report referring to the metalworkers.  
 
Rolling one-day strikes in May
The metalworkers union IG Metall had held rolling one-day strikes in May that forced bosses in the auto industry to agree to the union’s demands for a 4 percent wage increase. Up to 130,000 workers from 135 plants were called out on strike to support the wage demand.

The construction workers’ job action followed actions by members of the postal and telecommunications union Verdi, which organized a series of warning strikes in June. Some 10,000 telephone and postal workers stopped operations in Hamburg and Munich demanding a 6.5 percent wage increase for 120,000 employees at Deutsche Telekom and 240,000 postal workers at Deutsche Post.

Capitalist rulers in the EU and throughout Europe are growing increasingly alarmed at the job actions by German workers. "The main fear in Brussels is that the strike could spread, with copycat actions taken across the European Union," the BBC reported last month, referring to the metalworkers strike.

"If it became a widespread phenomenon in Europe, it would be disruptive for European growth," complained John Akerholm, chairman of the European Commission’s economic and financial committee.  
 
 
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