Decline in unemployment in Germany in May, uncertainties in 2011
The German unemployment rate reached its lowest level since December 2008 but the uncertain economic outlook for 2011 could undermine this trend.
The number of unemployed fell by 21,000 in Germany in June, seasonally adjusted data, after falling 41,000 in May (revised from 45,000) to go back to 3.23 million, announced the Federal Labour Office.
The German unemployment rate displays and twelfth consecutive month of decline.
"The unemployment figures have stagnated at this level," said Andreas Scheurle, economist at DekaBank. "The economy is expected to deteriorate in 2011.This suggests that this figure should remain at this level. "
The number of unemployed for the month of May has been revised from 3,246,000 to 3,251,000 people.
The unemployment rate remained unchanged in June at 7.7% of the workforce.
Economists polled by Reuters expected a larger decline in the number of unemployed, with 25,000 applicants for fewer jobs and an unemployment rate unchanged at 7.7%.
In unadjusted data, the number of unemployed fell by 88,000 over the month to 3.153 million.
The director of the Federal Labour Office, Frank-Juergen Weise, it is possible that the number of jobseekers fell below the three million mark by the end of the year.He stressed the good economic performance in the second quarter but had doubts in 2011.
The drop in unemployment follows a surge in industrial orders in April.
"As the order books are filling up, companies must increasingly resort to stop using part-time work or new employees. However, he cautioned against being too optimistic," said Joerg Zeuner VP Bank.
The German manufacturing activity fell further in June, suggesting a slower recovery in Europe in the second half of 2010.
"The impending austerity measures to balance budgets in the euro area is already clouding the outlook," he adds."A further decline in demand would again use under pressure."
German Chancellor Angela Merkel unveiled this month a plan to achieve budgetary savings of 80 billion euros over the next four years, with the objective to comply with the requirements of the European Union by 2013.