German growth too weak for job creation

1st September 2004, Comments 0 comments

1 September 2004 , BERLIN - Even if Germany posts two percent economic growth this year, the upswing is too weak to create desperately needed new jobs, Federation of Employers President Dieter Hundt said Wednesday. Hundt told reporters that Germany's economy, which the government says will expand by 1.5 to two percent this year, is still being hampered by the failure to carry out swifter reforms. "Growth of two percent is not enough to bring new jobs," said Hundt, adding, "At the very best there will be

1 September 2004   

BERLIN - Even if Germany posts two percent economic growth this year, the upswing is too weak to create desperately needed new jobs, Federation of Employers President Dieter Hundt said Wednesday.

Hundt told reporters that Germany's economy, which the government says will expand by 1.5 to two percent this year, is still being hampered by the failure to carry out swifter reforms.

"Growth of two percent is not enough to bring new jobs," said Hundt, adding, "At the very best there will be a reduction in the number of jobs being lost."

Germany's unemployment rate is currently 10.5 percent but the level in the economically hard hit eastern part of the country is 18.5 percent, or more than double that in the west.

Reform zeal has been dented by mass protests over the past month aimed at the German government's plan to cut unemployment benefits.

Chancellor Gerhard Schroeder has vowed not to water down the main reform bill, but has nevertheless approved a number of minor changes.

Hundt expressed concern over what he termed the government's apparent halt to any further economic and welfare state reforms.

"We are farther away than ever from our main goal: more employment in Germany," he warned.

Failure to revamp Germany's social welfare and labour markets would force more companies to move production abroad, Hundt said.

DPA

Subject: German news
 

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