German Unemployment Exceeds Expectations in September, Says Labour Office – Reuters

By Maria Martinez

BERLIN – The unemployment rate in Germany saw a larger-than-expected increase in September, highlighting the ongoing difficulties faced by the country’s economy, according to figures released by the federal labor office.

The report indicated that the number of unemployed individuals rose by 17,000, bringing the total to 2.82 million when adjusted for seasonal variations. Analysts had anticipated a smaller increase of 12,000.

Despite this rise in unemployment, the seasonally adjusted jobless rate remained steady at 6.0%.

In September, there were 696,000 job vacancies, which represents a decline of 65,000 from the previous year, the labor office noted.

Economists are forecasting potential further contraction for Germany’s economy, which experienced a 0.1% decline in the second quarter, suggesting it may face another downturn in the third quarter. A recession is typically characterized by two consecutive quarters of negative growth.

In light of the economic uncertainty, businesses in Germany are adopting a more cautious approach to workforce planning, as reported by the Ifo Institute. The Ifo employment barometer fell to 94.0 points in September, down from 94.8 points in August.

Klaus Wohlrabe, head of Ifo surveys, commented on the situation, stating, "The structural problems of the German economy are gradually leaving their mark on the labor market," noting that companies are increasingly considering job cuts.

What had been a resilient labor market is now beginning to feel the effects of economic weakness. Unemployment is projected to rise to 6.0% this year, an uptick from 5.7% in 2023, a level forecasted to remain until 2026, according to insights from leading economic institutes.