German unemployment ticks up as country prepares for election

GERMAN unemployment rose slightly in August, up by 7,000 people, the last news on official joblessness before the country’s election in September.

There are now 2.94m people unemployed throughout the country, though the rate held steady at 6.8 per cent, one of the lowest levels in the Eurozone.

Consumer price inflation was also announced yesterday, up 1.6 per cent in the year to August, compared to 1.9 per cent in the year to July.

Chancellor Angela Merkel’s Christian Democratic Union is ahead in most German polls, and looks likely to be the largest party after the election on 22 September.

However, what coalition the country has to build to ensure a stable government remains to be seen. The current government’s junior partner, the Free Democratic Party, is polling at a much lower level than it managed in the previous election.

The German economy generally appears to be rebounding from a mild slump, with GDP expanding by 0.7 per cent in the second quarter

Berenberg’s Christian Schulz commented: “Investment should make a comeback in Germany, leading to more job creation. That may not quickly reduce the number of unemployed, however, as firms struggle to find the required qualifications in the remaining pool”.