No improvement in sight
Economic crisis hits the labor market – three million unemployed in winter?
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The stagnation of the German economy can also be felt on the labor market. Companies are looking for fewer applicants, but more people are looking for a job. The responsible authority currently sees no improvement. In winter, unemployment could rise to levels not seen in a long time. Things are looking better when it comes to training places
The economic weakness continues to weigh on the German labor market and has pushed the number of unemployed to its highest level in three and a half years. In August it increased by 63,000 to 2.872 million, as the Federal Employment Agency in Nuremberg announced. It was last even higher in February 2021. “The labor market continues to feel the consequences of economic stagnation,” said BA boss Andrea Nahles. According to her, there is no improvement in sight. The BA does not rule out that with the usual winter unemployment in January 2025, more than three million unemployed people will be registered again for the first time in ten years.
Nahles pointed out that unemployment has been rising steadily since 2022. “There is currently nothing to indicate that this steady increase is currently slowing down or even being reversed,” said the BA boss. Taking seasonal fluctuations into account, the number of unemployed rose by 2,000 month-on-month. The unemployment rate rose by 0.1 percentage points to 6.1 percent in August. The BA registered 176,000 more unemployed people in August than a year ago.
The demand for workers in companies is also declining. According to the information, 699,000 vacancies were registered with the employment agencies in August. That's 72,000 fewer than a year ago.
The increase in unemployment is partly due to the usual summer break in the holiday month of August. The weak economy also adds to this. “The lack of economic tailwind is also visible in employment subject to social security contributions,” said Nahles. In June, at 34.85 million, this was 143,000 higher than a year ago: “But growth is weakening more and more.” Employment is being reduced in industry, construction and trade. There is more employment, especially in health and social services.
According to the BA, economic short-time work has also increased slightly again. In June, economic short-time work benefits were paid to 232,000 employees. Short-time work is used particularly in the manufacturing sector.
There was a slightly higher number of people seeking training on the training market. From October 2023 to August 2024, 418,000 applicants registered, 10,000 more than in the same period last year. Of these, 82,000 had neither a training position nor an alternative in August. At the same time, 158,000 training positions were still unfilled.
“Every young person looking for training is a potential skilled worker and should therefore not be lost to us,” said Nahles. Employer President Rainer Dulger also warned that the numbers were an unmistakable wake-up call: “Too many training positions remain unfilled.” What is urgently needed is an improvement in the quality of education and practice-oriented career orientation.
