In brief
In October, Germany’s unemployment rate slipped to 6.3%, down from 6.4% in September, as the number of unemployed fell by 40,000 to 2.955 million. Economic officials say this modest improvement comes amid slow growth and cautious business hiring. The data were released by the Federal Employment Agency and confirmed by a Germany-wide firm survey.
Germany’s unemployment rate fell to 6.3 percent in October, according to a data release by the Federal Employment Agency on Friday, down from 6.4 percent in September.
The number of jobless people dropped by 40,000 to 2.955 million, but it was still 44,000 higher than a year earlier, the agency said.
Andrea Nahles, head of the agency, warned that the decline was modest and that economic conditions were still insufficient for a stronger recovery.
"Economic conditions remain insufficient for an improvement in the labor market," said Nahles.
A business survey by the Munich‑based ifo Institute showed that companies are becoming more cautious about cutting jobs. The employment barometer rose to 95.5 points in October from 95.1 in September, yet confidence in the manufacturing sector, especially in automotive, remained weak.
Klaus Wohlrabe, head of ifo surveys, said companies are no longer cutting jobs as aggressively, but an economic upturn strong enough to expand the workforce is still lacking.
"Companies are becoming somewhat more cautious about cutting jobs, but the economic upturn still lacks the strength for a broad expansion of the workforce," said Wohlrabe.
The modest drop in unemployment comes at a time when Germany’s economy grew only 0.2 percent in the third quarter, its slowest pace since the first half of the year. Exports weakening and investment falling have dampened the outlook for jobs.
Carsten Brzeski of ING Research cautioned that a short‑term rebound in growth does not signal a sustainable recovery. He said the outlook depended heavily on fiscal stimulus and structural reforms.
The German government expects growth of 1.3 percent this year, but analysts say the recovery is fragile and not yet broad‑based, with households still restrained by high prices and a weak labor market.