Unemployment in Germany up 21,000 in May

UNEMPLOYMENT in Germany rose by 21,000 in May, the biggest monthly rise in four years, while the total number of jobseekers hit 2.96m, its highest point since June 2011.

The Federal Labor Agency said that, on a seasonally adjusted basis, the number of people out of work was now 2.963m, well above analysts’ expectations.

Despite the rise, the unemployment rate remained unchanged at 6.9 per cent, one of the EU’s lowest.

Christian Schulz, chief economist at Berenberg, remained upbeat despite the disappointing figures. “Underlying fundamentals are very favourable. Germany has created millions of jobs since the Agenda 2010 reforms were launched in 2004”, he said.

Chancellor Angela Merkel, who is seeking re-election for a third term in September’s federal election, wants to keep unemployment below three million.

Separately, the consumer price index (CPI) for Germany was also published yesterday. It showed the annual inflation rate rose to 1.5 per cent in May from 1.2 per cent in April – below the target of nearly two per cent.