Construction costs are currently skyrocketing

But that just can't work, can it? So what can the company do about inflation? Not every company can simply enforce price increases, or they are then equivalent to shrinkage.

The argument, "everything is getting more expensive, give me a raise," is easy to make and obvious, but if the company doesn't earn more, it can't just raise everyone's wages across the board... So I'm surprised that this is such an automatic process. Especially, where is the motivation if I know I'll get my 2% every year anyway without changing anything? Or the other way around: If someone really puts in effort, does an amazing job, and is a high performer. Should I then tell them, yes, because of your performance the company earned 10% more, but we also had 10% cost increases and I have to compensate everyone for inflation, so you still only get 2% more, just like everyone else... Well, who would then go elsewhere? The high performer who actually makes it possible for the company to grow. That won't work well for the company in the long run either.

: Of course, there is market development (my employer did not even exist 50 years ago) also in the labor market... But then we are rather talking about new hires or, in the case of a justified raise, if there has been nothing for two years, a bigger increase is given. What I want to get at: It is not an automatism along the lines of, every year there is 2% more...

In our group, a minimum %-rate of wage increase is also set annually, which is based on the general business success and inflation, etc. In addition, further % are granted performance-related or bonus payments are made.

It's not about giving everyone the same thing or more of the same thing. But to say only those who deliver "above-average performance" (not everyone can do that at the same time, even if they are good) or get promoted receive more money ... that is targeted demotivation of the employees. The economic situation can certainly be taken into account. If the company has no money, there is little to negotiate. But there are certainly some ways; currently, for example, an inflation bonus can be paid. Since it is tax-free, it costs the employer significantly less for the same net salary. Our situation right now is rather meh, and agreements like those from IG Metall are definitely out of the question. But in the end, you are competing with others, and an employer who does not make an effort will surely lose their people if salaries rise by 8-10% elsewhere.

Then I expressed myself unclearly. By additional performance I do not mean more compared to the average of the company, but compared to my own previous performance. So what have I done to improve my personal work performance? Have I developed myself or my area of responsibility in any way? It can be something as simple as creating a new Excel sheet where everyone enters their vacation, so that there are no times when no one is available as a contact person (just to give a silly example). That’s what it’s about.

Then I expressed myself unclearly. By additional performance, I do not mean more compared to the company average, but compared to my own previous performance. So what have I done to improve my personal work performance. Have I developed myself or my area of responsibility in any way? It can be something as simple as creating a new Excel sheet where everyone enters their vacation days, so that there are no times when no one is available as a contact person (just to give a silly example). That's what it's about.

And at some point you have fully developed and can't get any better. Will your salary then be cut? Because you haven't improved compared to the previous year. Reminds me of Amazon’s subcontractors who first give their drivers 80 packages per route—well aware that it’s impossible to do that in 8 hours. The driver does unpaid overtime at the beginning to complete his routes. The supervisor then says: great, you are really good and fast! Starting tomorrow you’ll have 90 packages in the sprinter. If you try a little harder, you can definitely manage that!