Germany: Slight increase of the number of unemployed

EcoFlash

In July, the unemployment rate remained unchanged (at 6.8%). However the number of unemployed increased for the fourth consecutive month (+7,000 m/m). Moreover the pace of increase in employment (published with one-month lag) remained lower than last year. Up by 47,000 m/m on average in 2011, it rose by 26,000 m/m in June.

In July, according to the preliminary data released by the Federal Labour Office, the unemployment rate remained unchanged. At 6.8%, it has been at the same level since December 2011.

The number of unemployed, at 2.89 millions in July, remained down by 2.2% year-on-year. However the pace of decrease eased. Indeed, the number of unemployed increased for the fourth consecutive month in July (+7,000 m/m).

Employment (published with one-month lag) slightly rose in June, but the pace of increase eased in comparison with the rises recorded until last year. Up by 47,000 m/m on average in 2011, it rose by 26,000 m/m in June (after 34,000 m/m in May).

This slowdown, which comes after an increase of employment by more than 1.3 millions since the summer 2009, should persist. Indeed, the moderate economic growth is expected to penalize employment again in the coming months. Employment had probably also declined in manufacturing sector since this spring, as the employment component of the PMI, which reached its lowest level since January 2010 in July, remained below the 50-threshold for the fourth month in a row (at 45.2, after 47.8 in June). Moreover job creation in the service sector, which was resilient until now, may even stagnate.

Tensions have also remained tight for now and unemployment rate should remain low. But tensions should ease in the coming months. Besides, the overall ratio between the number of vacancies and unemployed, which was still at a high level in July, decreased further (to 16.5 after 16.8 in June).

Published On Tue, Jul 31 2012, 10:25 GMT Previous entries

Catherine Stephan

Follow Follow my activity on FXstreet.com BNP Paribas website

Expert in Germany, Austria, Switzerland and Eu Enlargement.

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