German industrial leaders have called for an extension of the standard working week from 35 to 40 hours without additional pay, marking a significant shift in a long-standing labor debate that dates back more than 40 years. Key executives at major firms including Mercedes-Benz and tool manufacturer Stihl have cited rising labor costs as a threat to the country’s global competitiveness.

Martin Brudermüller, chair of Mercedes-Benz Group’s supervisory board, recently told a German newspaper that labor costs in Germany had become disproportionately high compared to other countries. He argued that the nation had lost its "productivity advantage" over important global competitors, and suggested that the 40-hour week should be seriously reconsidered. Labor costs in German manufacturing currently stand at €49.50 per hour, nearly 50 percent higher than the EU average of €33.70, and more than three times higher than in Hungary, where the cost is €15.60.

The push for longer working hours surfaces ahead of upcoming pay negotiations involving industrial unions, which traditionally favor maintaining the 35-hour week. The 35-hour standard was gradually introduced following a protracted strike by metalworkers in West Germany in 1984, one of the country’s most contentious labor disputes. Currently, roughly 20 percent of German workers — particularly in sectors such as automation, engineering, and steel — operate on a 35-hour week, while the average across all industries is about 37.8 hours weekly.

Germany typically records among the shortest annual working hours in the OECD, a factor influenced in part by a large share of part-time employment. However, the long-standing balance between relatively high wages and other advantages—including political stability, a skilled workforce, and robust industrial infrastructure—has been disrupted by a series of challenges in the manufacturing sector.

Since peaking in late 2017, German industrial output has declined by more than 15 percent, affected by successive energy price shocks, intensified competition from China, U.S. tariffs, and structural shifts toward electric vehicles. According to Marcus Brudermüller, global managing director at consultancy Roland Berger, the cost competitiveness gap with rival economies has widened drastically, in some cases by a factor of three or four.

Despite the downturn in production, employment in manufacturing has declined more gradually, with around 6.5 million people still working in the sector. Nonetheless, further job losses are anticipated.

Economists suggest that increasing working hours without raising wages could become necessary for companies to remain viable. Martin Werding, a member of the German Council of Economic Experts, noted that traditional employer strategies such as relying on temporary workers to maintain flexibility are no longer sufficient to address current challenges. He emphasized that increasing the working week by 14 percent while keeping wage costs steady is a substantive issue beyond symbolic politics.

The emerging debate over working hours reflects broader concerns about preserving Germany’s industrial base amid growing international pressures and evolving economic realities.