BERLIN Metal-workers in two new German states joined Monday rolling strikes by the powerful IG Metall Union in a move that threatens to hurt the economy and Chancellor Gerhard Schroeder's chances of re-election.

Some 4,500 union members were called on to down tools at seven companies over demands for higher wages in the eastern states of Berlin and Brandenberg, where the strike was the first for 70 years, AFP reported.

Automaker Daimlerchrysler and lift manufacturer Otis were the first of 25 companies, employing 10,000 workers in the sector, expected to be hit by one-day stoppages in the two states over the week.

Strikes continued Monday in the key industrial region of Baden-Wuerttemberg, where IG Metall said about 100,000 employees had taken part in the series of rolling strikes last week that began overnight on May 5.

Daimlerchrysler and Audi were the target there for the second Monday in a row.

IG Metall is demanding a 6.5-percent wage hike, which employers say is economically unrealistic, and is fighting for pay equality between the west and the former communist East. Analysts say the union may settle for four percent.

Employers have offered the workers a 3.3 percent pay rise plus bonuses.

Pay negotiations have stalled over the last week, and the Gesamtmetall Employers Federation has begun increasing pressure on the union by setting new conditions for round-table talks on reducing unemployment.

The head of the German Chambers of Commerce and Industry (DIHK), Ludwig Georg Braun, said in an interview with focus news weekly that employers would tell Schroeder they would insist on wage increases being linked to the rate of productivity.

Employers, trade unions and government representatives are to gather this summer to discuss ways to tackle joblessness, one of Schroeder's biggest electoral headaches, and Braun's remarks represent a harder line by industry.

Schroeder and his Social Democrats, which generally have good relations with the union, face a general election on September 22.