Germany's jobless rates fall as global demand rises
Published 06/01/2010 | 05:00
German unemployment unexpectedly fell in December as the outlook for exports brightened and government spending helped bolster Europe's biggest economy.
Declining joblessness in Germany, the world's biggest exporter, underscores reviving global demand helped by stimulus spending. German exports rose in October, while the European Commission said on December 21 that Europe's economy as a whole may continue to gather strength this year after emerging from recession in the third quarter of 2009.
"With the improving economic outlook, gradually filling order books and increasing demand for new labour, it looks as if the threat of exploding unemployment rates has been averted," Carsten Brzeski, an economist at ING Groep in Brussels, said. German unemployment will peak at about 3.8 million, he added.
Germany's economy expanded 0.7pc in the three months that ended September after pulling out of recession in the second quarter.
"The labour market has been robust despite the deep recession in 2009," Labour Agency head Frank-Juergen Weise said. While unemployment would have risen 6,000 in December without statistical changes, compared with 2008, the increase "was by far not as strong as feared".
Germany extended its short-term work programme for a year from this month to stem rising unemployment, allowing companies to continue tapping federal aid to help pay wages. As many as 140,000 people were on short-term work in December, the Labour Agency said. (Bloomberg)