Germany’s unemployment rate rose more than expected in September, signaling that the country’s economy is facing increasing headwinds and impacting the labor market, Bloomberg reports.
Joblessness increased by 17,000, surpassing the 13,500 increase predicted by economists, according to data released on Friday. While the unemployment rate remained at 6%, the trend suggests a cooling labor market.
Andrea Nahles, head of the Federal Labor Agency, acknowledged the sluggish recovery in the labor market.
“The fall revival in the labor market is proceeding only sluggishly,” he said.
Despite softer demand both domestically and in key export markets, German companies have been hesitant to cut staff, primarily due to widespread shortages of skilled workers. This makes it more difficult to quickly hire workers in a potential economic upswing.
However, there are growing signs of a cooling labor market. Employment growth has slowed, and the number of job vacancies decreased by about 15% in the second quarter compared to the previous three months. Business surveys by S&P Global and the Ifo Institute this week also indicated a rising willingness among companies to reduce staff numbers.
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