Due to the economic weakness in Germany, the labor market is likely to come under pressure in the winter. The employment agencies expect unemployment to rise.
According to employment agencies, the economic weakness in Germany is increasingly dragging down the job market. “The labor market is facing a difficult winter,” explained Enzo Weber from the Institute for Labor Market and Occupational Research (IAB). In the IAB’s monthly survey of employment agencies, the unemployment forecast has fallen significantly into negative territory and, after a minus of 0.7 points, is now at 96.4 points. “The employment agencies expect that the economic downturn will cause unemployment to rise further,” explained Weber.
The barometer asks about the expectations of all German employment agencies for the next three months. It is therefore considered an early indicator of the future development of the labor market. A value of 100 is considered a neutral outlook, a value below 100 indicates a negative development.
The leading indicator for employment fell by 0.1 points to 102.6 points in October. The employment outlook therefore remained positive, but significantly subdued compared to the spring.
Weaker Autumn boom in the labor market
The Federal Employment Agency (BA) will present the balance sheet for October next Thursday. In the past few months, the labor market had developed somewhat worse than usual for this time of year. The autumn recovery was comparatively small in September, with the number of unemployed falling by 69,000 to 2.627 million.
The unemployment rate fell by 0.1 percentage points to 5.7 percent. Federal Labor Minister Hubertus Heil said of the September data that employees still “have a high level of job security.”
GDP shrank in the summer quarter
Meanwhile, the economic outlook continues to deteriorate. The German economy went into decline in the summer. The gross domestic product (GDP) fell by 0.1 percent from July to September, the Federal Statistical Office (Destatis) announced today.
However, the economy in this country has been slightly better this year so far than previously reported. As it turned out after the presentation of revised Destatis data, there was a small increase in GDP of 0.1 percent in the spring, instead of the previously reported stagnation. And at the beginning of the year, the economy did not shrink, but remained at the previous quarter’s level.