German jobless fall beats forecasts

29th March 2007, Comments 0 comments

29 March 2007, Berlin (dpa) - German unemployment fell more than expected in March to 9.2 per cent, the nation's labour office said Thursday, as employers stepped up hiring on the back of the country's economic upswing. The March seasonally adjusted jobless rate compared to 9.3 per cent in February, with the numbers out of work in Europe's biggest economy falling by 65,000 to 3.832 million in March - the seventh consecutive monthly decline in the country's unemployment. This month's drop in seasonally adju

29 March 2007

Berlin (dpa) - German unemployment fell more than expected in March to 9.2 per cent, the nation's labour office said Thursday, as employers stepped up hiring on the back of the country's economic upswing.

The March seasonally adjusted jobless rate compared to 9.3 per cent in February, with the numbers out of work in Europe's biggest economy falling by 65,000 to 3.832 million in March - the seventh consecutive monthly decline in the country's unemployment.

This month's drop in seasonally adjusted unemployment, which is a gauge of labour market trends, was more than the 50,000 fall that economists had forecast. Unemployment in Europe's biggest economy fell by a revised 80,000 in February.

"All surveys report that companies are continuing to put on workers," said DZ-Bank economist Bernd Weidensteiner with Thursday's labour data a further sign that the economic momentum built up in the nation last year is helping to drive economic growth this year.

At the same time, the number of job vacancies surged again by more than 26 per cent to 640,000, leading employers to complain about a shortage of skilled labour in the country.

Meanwhile, German employment crept up to its highest level since unification almost 17 years ago, rising by 1.5 per cent to 38.94 million in February, the nation's statistics office also said Thursday.

In the more politically sensitive seasonally unadjusted terms, unemployment fell by 114,000 to 4.108 million, lowering the unadjusted rate from 10.1 per cent in February to 9.8 per cent.

This compares to a 12.0 per cent jobless rate in March 2006 with Germany's mild winter this year also helping to encourage hiring in weather sensitive-sectors such as the building industry.

Germany emerged last year from a protracted period of stagnation to report a perky economic growth rate of 2.7 per cent.

Amid signs that the nation's economy is likely to withstand a projected global economic slowdown and January's hefty value-added tax hike, many economists have raised their 2007 German growth projections to plus two per cent. Some, however, expect the economy to expand at about the same pace as last year.

Indeed, Thursday's unemployment figures add to the steady flow of positive economic news out of Germany with the steady improvement in the jobs market helping to boost the mood among the nation's consumers.

After being a long-running drag on German economic growth, household spending is tipped to record a modest rise in 2007 with a key survey released this week showing consumer confidence rebounding.

"Sustained optimism in the economic outlook is also having a positive effect both on propensity to buy, as well income expectations," said the Nuremberg-based GfK market research institute releasing its latest consumer sentiment report.

The release of the GfK survey followed an unexpected jump in German business confidence in March.

The March unemployment data also highlighted the pickup in the labour market in the hard-pressed economy in Germany's former communist east.

While the number of people out of work in western Germany fell by a seasonally adjusted 46,000 in March to 2.53 million, unemployment in the east dropped by 19,000 to 1.3 million.

In adjusted terms, unemployment in the west stood at 8.4 per cent in March and 16.5 per cent in the east.

DPA

Subject: German news

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