German labor market feels effect of slowing economy

German labor market feels effect of slowing economy

German unemployment unexpectedly rose for the first time in nearly two years in May, data showed on Wednesday, as slowing growth in Europe’s largest economy spilled over into the labor market, reports Trend citing to Reuters

The number of people out of work rose by 60,000 to 2.279 million in seasonally adjusted terms, according to the Federal Labour Office. That compared with a Reuters consensus forecast for a decline of 8,000.

Germany’s solid labor market has been the backbone of a domestically driven upswing in recent years. Several months of rising unemployment could weaken household spending and knock out one of the most important supports for growth.

Though the unexpected rise was mainly due to an audit of the status of some unemployment benefit recipients, the slowing economy also played a role, Labour Office head Detlef Scheele said.

“On the labor market, we can see first spill-over effects of the recently somewhat weaker economic development,” Scheele said. “The demand of companies for new employees is weakening sharply while remaining on a high level.”

He added, however, that the special factor was to blame for roughly two-thirds of the overall jobless rise of 60,000.

The seasonally adjusted jobless rate rose to 5.0%, the data showed. In unadjusted terms, unemployment increased by 7,000 to 2.236 million in May.

Germany’s export-reliant industries are already facing obstacles from trade disputes and uncertainty linked to Britain’s possible chaotic departure from the European Union.

“FAT YEARS OVER”

“All good things must come to an end,” said Thomas Gitzel, chief economist at VP Bank. “This applies also for the job bonanza on the German labor market.”

Gitzel said that industrial companies were curtailing production in light of falling orders, which could be seen in lower demand for temporary workers.

The bleak labor market report comes after a survey showed on Tuesday that consumer sentiment unexpectedly cooled heading into June, falling to its lowest in more than two years.

“The fat years are over,” said Bastian Hepperle from Bankhaus Lampe. “The labor market seems to have reached its zenith.”

He added that overall employment remained relatively high, which should support private consumption and with it the domestically driven growth cycle.

The government last month halved its 2019 growth forecast to 0.5%, which would mark a sharp slowdown following calendar-adjusted growth rates of 2.5% in 2017 and 1.5% in 2018.

KfW analyst Martin Mueller said a temporary increase in the jobless total could not be ruled out. “However, a further reduction in unemployment is expected for the year as a whole,” Mueller said.

“Due to the continuing shortage of skilled workers, the employment opportunities for unemployed people with sought-after qualifications are still excellent,” Mueller said.

In a sign that German employment growth and the development of the jobless total are decoupling, employment as measured by the International Labour Organization climbed to a record 45.11 million in April, seasonally adjusted data from the Federal Statistics Office showed earlier on Wednesday.

Russia bans import of tomatoes from Uzbekistan’s Fergana region
Russia bans import of tomatoes from Uzbekistan’s Fergana region
Uzbek Ministry of Finance publishes draft law on increasing taxes on gasoline, diesel
Uzbek Ministry of Finance publishes draft law on increasing taxes on gasoline, diesel
Uzbekistan to grow industrial cannabis in Sardoba district
Uzbekistan to grow industrial cannabis in Sardoba district
Loading Bars
Latest
Trump says will leave White House if Electoral College votes for Biden
Moscow documents 77 deaths from COVID-19 in past 24 hours
WHO urges African states to strengthen readiness for COVID-19 vaccine
UK records another 17,555 coronavirus cases with 498 cases
China calls for healthy, stable military ties with U.S.
Italy reports 29,003 new coronavirus cases, 822 deaths - health ministry
Russia's Sputnik V developers call on AstraZeneca to try combining vaccines
Paris does not recognize so-called "Nagorno-Karabakh Republic" - Foreign Ministry
Recovery of oil prices has positive impact on Kazakhstan’s external balances - IHS Markit
Group of German medical experts arrives in Kyrgyzstan to fight COVID-19
Georgian NCDC Head urges people over 70 to stay at home except in necessary circumstances
Iran, Russia to cooperate on COVID-19 vaccine development
Bitcoin price down 12.7%
Armenian eco-terror in Karabakh constitute serious threat to peace and security in region - opinion
Hungary, Poland double down to try to eject rule-of-law condition from EU budget
Over 3,500 coronavirus-related deaths recorded in Moscow in October
Belavia resumes regular flights from Baku to Minsk in early December
Iran hopes Kish-Istanbul-Abadan flights to improve its trade
Kazakhstan Railways opens tender to buy welding equipment
Georgia to support businesses amid new coronavirus restrictions
WB extends deadline for implementation of agricultural project in Azerbaijan
Turkey steps up inspections as coronavirus pandemic figures climb
Cavushoglu and Stoltenberg discuss situation in Karabakh
Swedish royals test positive for COVID-19
England reveals new regional COVID tiers in fight against coronavirus
Azerbaijani gymnasts reach finals of 36th European Championship in Ukraine
Georgia continues to support its citizens amid COVID-19 pandemic
News on return of Azerbaijani soldier captured by Armenians false, relative says
Azerbaijan sends note of protest to France
Ample opportunities for investments to be created in Karabakh – minister
Azerbaijani's negotiations with UAE on renewables nearing completion
Kazakhstan, Mongolia eye signing roadmap for trade, economic co-op
Russia bans import of tomatoes from Uzbekistan’s Fergana region
36th COMCEC session opens under chairmanship of Turkish president (PHOTO)
Uzbek Ministry of Finance publishes draft law on increasing taxes on gasoline, diesel
Russian Gazprombank predicts Azerbaijan's economic recovery in 2021
iPhone 12 Pro Max and iPhone 12 Mini now at Azercell Exclusive shops!
Iran becomes self-sufficient in building oil, gas platforms
Cotton growing in Azerbaijan hits record - agriculture ministry
Italian municipalities adopt documents expressing solidarity with Azerbaijani people
Uzbekistan to grow industrial cannabis in Sardoba district
Azerbaijan detects 3,705 new COVID-19 cases, 1,609 recoveries
Turkmen Ministry of Construction opens tender for equestrian sports complex construction
Azerbaijani, Saudi FMs exchange views on current situation in Karabakh
Uzbekistan reveals data on its ICT sphere enterprises and organizations
Azerbaijan to export persimmons to Slovakia and Czech Republic
Level of religious tolerance in Azerbaijan is much higher than in France - ISESCO ex-director
Kazakhstan's exports to Switzerland decrease year-on-year
Azerbaijani medical insurance agency signs contract with tender-winning IT company
Resolution adopted by French Senate must be canceled – Azerbaijani NGO head
Volume of Turkish textile clothing supplies to Kazakh market surges
Latvian AirBaltic cancels Riga-Tbilisi-Riga flights
Reconnaissance work completed within Baiterek space complex creation in Kazakhstan
Thermal power plant modernization, other projects underway in Kazakhstan's Karaganda
Georgia imposes further restrictions to curb spread of coronavirus
Georgian carrier to launch regular cargo flights from China to Europe
Russia's Rostelecom expects to develop transit routes through Turkmenistan
Average monthly salary in Azerbaijan's Nakhchivan rises
Azerbaijani, Afghan FMs discuss latest situation in region
WB, AIIB to fund rural infrastructure development in Uzbekistan
Azerbaijani, Indonesian FMs stress importance of trilateral ceasefire statement
Austria fully supports Uzbekistan obtaining of EU’s GSP beneficiary status
Turkmenistan's Dashoguz region opens tender for installation work
France not part of Karabakh settlement, but part of problem - Turkish defense minister
Japanese companies to provide technical support for terry production in Uzbekistan
Germany's hotspot district to launch COVID-19 mass tests for children
Yield of citrus fruits in Azerbaijan up
Capital of Kazakh companies operating in Turkey revealed
Iran boosts its pistachio exports
World Economic Forum announces Azerbaijan's road quality score
Share of assets in Azerbaijani banking sector declines
Kazakhstan eyeing amending legislation to support renewable energy dev't
Georgian Hualing Free Industrial Zone plans to finalize deal with 4 new companies
Mortgage lending in Azerbaijan through state line grows manifold
Kazakhstan to launch hundreds of industrial projects before year-end
Azerbaijani ICT company wins tender on purchase of licenses
Central Bank of Azerbaijan discloses data from foreign exchange auction
Employment in Iran's West Azerbaijan Province increases
Buta Airways to Increase the Frequency of Flights Performed to Izmir
Azerbaijan, Hungary discuss possibilities of attracting investors to liberated territories
Georgian Huliang FIZ offering available land plots to potential investors
Azerbaijani NBCO talks about its activities amid coronavirus
Azerbaijan’s carpet producer signs tender contract
Many members of French Senate unaware war in Karabakh ended (VIDEO)
Number of people infected with coronavirus pandemic in Iran exceeds 900,000
Baku Stock Exchange admits local investment company
Uzbekistan eyes to set up local production of various vaccines
France does not deserve Azerbaijan’s confidence – senator
Bahar Azadi gold coin price still falling in Iran
Bank mortgages in Azerbaijan rise
Full text of Azerbaijani parliament’s statement against French Senate’s resolution
Iran's economy remains strong and steady – Iran's president
Turkmenistan to be vital strategic partner, gas supplier to China long-term - Wood Mackenzie
EDB talks Kazakhstan's economy growth forecast, return to pre-COVID levels
Ambassadors of Turkey, Iran to Azerbaijan hold discusses on Karabakh
“I am quite sure that giving a hand to customers in this challenging time will pay off in the future”: interview with Dariusz Kacprzyk, Member of Supervisory Board of AccessBank Azerbaijan
Import of Turkish ready-made clothes by Iran down
Water resources of Azerbaijan’s Kalbajar district to be re-explored
Turkey's export of ready-made clothes to Uzbekistan down
Money supply in Azerbaijan grows - CBA
All news