German unemployment holds at record low in August

A worker applies cement to tramway tracks at a construction site in Berlin on April 18, 2018. / AFP PHOTO / John MACDOUGALL

FRANKFURT AM MAIN, Germany – Joblessness in Germany held firm at record lows in August, official data showed Thursday, as a robust economy kept companies hiring in Europe’s powerhouse.

Just 5.2 percent of workers were unemployed this month, according to seasonally-adjusted figures from the Federal Labor Agency (BA), matching analysts’ expectations.

The unemployment rate has not changed since May, remaining at the lowest level since German reunification in 1990.

“The labor market continues to develop favorably,” said BA chief Detlef Scheele in a statement.

In unadjusted terms, less indicative of underlying trends but more prominent in public debate, the joblessness rate increased by 0.1 percent to 5.2 percent, amounting to 2.35 million people out of work.

The jobless count typically increases in August as students graduate and register as jobseekers, and companies hold off hiring new staff until after the summer holidays.

The German economy, powered by booming domestic demand and a healthy appetite for its goods abroad, is expected to continue its strong run in the coming months, keeping unemployment in check.

The closely-watched Ifo business confidence index this week hit its highest level since February, as the United States and the European Union backed off an escalating trade dispute sparked by President Donald Trump’s “America First” policy.

Analysts expect third-quarter growth in Europe’s top economy to match the 0.5 percent rise it booked between April and June, when it outpaced the eurozone’s 0.4 percent growth.

“The number of unemployed people is expected to decrease further by the end of the year,” said KfW chief economist Joerg Zeuner.

“The job prospects for skilled workers have not been this good for a long time.