Minimum Wage of 14.60 Euros from 2027: What Labour-Intensive Businesses Need to Know About Their Value

The statutory minimum wage in Germany rises on 1 January 2027 from 13.90 to 14.60 euros, an increase of 5.04 per cent. For a business with 1.4 million euros of staff costs, of which 60 per cent are close to the minimum wage, our worked example shows 56,000 euros less EBITDA. At a multiple of 5 that is 280,000 euros less company value, unless the business passes the costs on to customers. Buyers factor this effect into their offers before it appears in your accounts.

For company valuation the minimum wage itself does not matter, only how much of it reaches the profit. This article shows which businesses are affected, how buyers calculate and what sellers should clarify before a process. As of 19.10.2026; an overview, not legal or tax advice.

What applies from 2027?

The Fifth Minimum Wage Adjustment Ordinance sets 14.60 euros from 01.01.2027. It was issued on 05.11.2025 (BGBl. 2025 I No. 268). The path ran in two steps: 13.90 euros since 01.01.2026, 14.60 euros a year later.

Item	2026	2027	Status
Statutory minimum wage per hour	13.90 euros	14.60 euros	enacted
Mini-job earnings limit per month	603 euros	633 euros	follows the minimum wage
Flat tax on mini-jobs	2 %	5 %	government draft only

On the flat tax: the government draft of the Income Tax Reform Act 2027 (BR printed paper 507/26) provides for an increase from 2 to 5 per cent. At 633 euros monthly earnings that is 18.99 euros more per mini-jobber and month. The legislative procedure is ongoing; the increase is not enacted.

In addition there are sector minimum wages, which in several sectors already lie above the statutory minimum, for example in construction, building cleaning and the electrical trade. For these businesses the increase has less effect, but their wage grades are often linked by collective agreement. Check the current values in each case; we have not verified them for every sector.

Austria has no statutory minimum wage. There, collective agreements set the floors.

Which businesses are hit?

Those that pay a high share of their staff costs to employees close to the wage floor. Typically that means building cleaning, security services, hospitality, retail, bakeries, logistics and simple services.

A DIHK survey of around 15,000 companies (autumn 2025, published 19.01.2026) shows the scale: roughly every second company has to adjust wages, 25 per cent directly because of the floor, a further 25 per cent by moving higher grades up. In hospitality it is 50 per cent, in construction 17 per cent. 40 per cent of companies plan to pass the extra costs on through prices, 13 per cent are considering job cuts.

The knock-on effect matters: when the entry wage rises, the grades above move up to preserve the gap. A business with few minimum-wage staff can therefore be hit harder than the number of minimum-wage contracts suggests.

What does it cost in EBITDA?

In our example business it is 56,000 euros or 14 per cent of EBITDA. The example is our own calculation with assumed values, not an industry statistic.

Assumption	Value
Revenue	4.0 million euros
Staff costs	1.4 million euros
EBITDA	400,000 euros (10 % margin)
Share of wages close to the minimum	60 % = 840,000 euros
Wage increase there	about 5 % = 42,000 euros
Knock-on for other wages	2.5 % on 560,000 euros = 14,000 euros
EBITDA reduction	56,000 euros (14 %)
At a multiple of 5.0	280,000 euros less company value

Employer social security contributions are not included; they raise the extra cost. The effect on value is much larger than on profit because the multiple magnifies it. How multiples come about is shown in the article on the EBITDA multiple by industry.

Anyone who passes the extra costs on through prices offsets the euro amount: in the example that would take a price increase of 1.4 per cent. The margin still falls slightly, because revenue grows without profit growing with it. For businesses with price escalation clauses in customer contracts that is no problem. For businesses with fixed-price contracts and long terms it is.

How do buyers calculate?

Buyers do not value the EBITDA of 2025 but the result the business will earn under the conditions of 2027. Three approaches are common:

• Pro forma EBITDA. The prior-year result is adjusted for known cost jumps, here the minimum wage. The buyer negotiates on that basis.
• Run-rate adjustment. The current year's result is extrapolated to twelve months at the new wages.
• Forecast. In the income approach or DCF, the wage increases flow into the projection. The method is explained in our article on the income approach and DCF.

Sellers should therefore calculate the effect themselves before a buyer does. A clean calculation keeps room for negotiation from being lost to uncertainty. How such adjustments show up in the price is covered in the article on EV/EBITDA.

Tax provides a counterweight: corporate income tax falls in steps from 15 to 10 per cent from 2028. It raises the result after tax and therefore acts on value in the opposite direction, but it does not replace margin management; details in the article on the corporate tax cut.

What should sellers prepare?

Four documents shorten the negotiation over the minimum wage effect.

First: a wage-grade analysis. Which grades are below 16 euros? How many employees are affected, mini-jobbers included?

Second: the contract position. Which customer contracts have wage or price escalation clauses? When do fixed prices expire?

Third: a pro forma calculation for 2027. With and without pass-through, so that you set the basis yourself.

Fourth: a statement on price enforcement. Have you successfully raised prices since 2022? Buyers believe in enforceability more readily when there is evidence.

Levers that support value independently of the minimum wage are in the article on increasing company value. How a sale process runs is described on the page selling your company.

FAQ

What is the minimum wage in 2027?

14.60 euros per hour from 01.01.2027, after 13.90 euros in 2026. That is 5.04 per cent more.

How does the minimum wage affect company value?

Through EBITDA and the multiple. In our example business, 56,000 euros of extra costs reduce value at a multiple of 5 by 280,000 euros, as long as nothing is passed on.

Does the minimum wage also apply in Austria?

No. Austria has no statutory minimum wage; collective agreements set the floors.

Will the flat tax on mini-jobs rise to 5 per cent?

The government draft of the Income Tax Reform Act 2027 provides for it. It is not enacted; the Bundestag and Bundesrat still have to decide.

Do buyers factor out the wage increase?

They factor it in. A pro forma EBITDA that reflects known cost jumps is usual. The better you can evidence pass-through, the smaller the discount.

Is it worth bringing the sale forward?

Not if the minimum wage is the only reason. The increase is known and is priced in. More important is regulating pass-through in customer contracts.

Sources: Fifth Minimum Wage Adjustment Ordinance of 05.11.2025, BGBl. 2025 I No. 268; draft Income Tax Reform Act 2027, BR printed paper 507/26 and BT printed paper 21/8235; DIHK, survey autumn 2025, published 19.01.2026; Ebner Stolz, minimum wage and margin compensation (10.11.2025). Calculations: own calculation with assumed values. As of 19.10.2026. Overview, not legal or tax advice.

If you want to know what your company is worth under the conditions of 2027: the initial conversation with IGCP is free of charge, non-binding and strictly confidential. → igcp.at