By Maria Martinez
BERLIN, March 31 (Reuters) – The number of unemployed people in Germany remained unchanged in March, labour office figures showed on Tuesday.
In seasonally adjusted terms, the jobless figure remained the same as in February at 2.977 million. Analysts and economists had predicted an increase of 2,000 in a Reuters poll.
The seasonally adjusted jobless rate was unchanged at 6.3% compared with a month earlier, in line with the forecast.
“As usual, the spring upturn in the labour market begins in March, however, without any significant momentum this year,” labour office head Andrea Nahles said in a statement.
In seasonally unadjusted terms, a total of 3.02 million people were unemployed in March, with a decrease of 49,000 in the number of people out of work from the previous month.
“The fact that the absolute number of those unemployed remains above the politically important 3 million for the third month in a row is anything but good news,” said Carsten Brzeski, global head of macro at ING, noting that the last time the total number of unemployed was above 3 million for three consecutive months was in 2014.
This is likely due to the fact that the German economy had made a weak start to the year even before the escalation in the Middle East, said Deutsche Bank Research economist Marc Schattenberg.
STRUCTURAL TRANSFORMATION
In addition, the structural transformation in key industries is continuing and may now be further fuelled in some areas by the energy price shock, Schattenberg said, noting that the latest data for January showed 178,000 jobs were lost in manufacturing compared with the same month a year earlier.
In total, there were 638,000 job openings registered with the labour office in March, 5,000 fewer than a year ago.
Labour market data typically react with a lag to geopolitical shocks such as the Iran conflict, as companies often wait before cutting hiring or jobs until the economic fallout becomes clearer.
“The economic situation remains tense, not least because of further international uncertainties,” Labour Minister Baerbel Bas said.
Germany’s economy has struggled to grow since the COVID-19 pandemic, as rising competition from China and higher energy prices have strained its export-driven economic model, with a renewed surge in energy prices due to the U.S.-Israeli war on Iran posing a further threat to its long-awaited recovery.
Germany’s leading economic institutes cut their economic growth forecasts for this year and next, and sharply raised their inflation forecasts in response, sources told Reuters on Tuesday.
With weaker-than-expected economic activity, the rising threat of AI and ongoing structural transition, ING expects a gradual worsening of the labour market continuing throughout the year.
(Reporting by Miranda Murray and Maria MartinezEditing by Madeline Chambers and Ed Osmond)
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