05 Jan 2010 Germany's jobless at 8.2%

[Watchman]

Germany's jobless at 8.2%
Jan 5, 2010

Job seekers queue up at a job fair as Germany saw a total of 3.42 million unemployed. -- PHOTO: AFP


FRANKFURT - GERMAN unemployment averaged 8.2 per cent of the workforce last year, with a total of 3.42 million unemployed, the Federal Labour Agency said on Tuesday.

That represented an increase from the 2008 level of 7.8 per cent, a trend that was also seen month-on-month in Europe's biggest economy.

In December, unemployment rose to 7.8 per cent from 7.6 per cent the previous month, the agency said. The raw number of jobless, the headline figure in Germany, climbed in December to 3.276 million, it added.

'After three months of declining unemployment numbers, it was only a matter of time before German unemployment would increase again,' ING senior economist Carsten Brzeski said, adding that it was probably not the last rise.

'Unemployment should continue to increase until mid-2010 and should peak at around 3.8 million,' the economist forecast, which he noted would be well below the peak of 5.2 million generated by Germany's last recession in 2002-2003.

In addition to a short-time work scheme that has kept more than a million workers on state-subsidised reduced hour payrolls, official data shows that Germany benefitted from a net increase in new companies last year. The country's relatively rigid labour market and the government's boost thus appears to have averted an explosion in unemployment amid the slowdown, but 'whether such a labour market can be a growth driver during the recovery is another story,' Mr Brzeski said. -- AFP