After almost a year of downward trend, the IAB labor market barometer recorded a slight increase. The leading indicator points to a moderate increase in employment in 2024.
The Institute for Labor Market and Occupational Research (IAB) of the Federal Labor Office gives a cautiously optimistic outlook for 2024. In December, the labor market barometer determined by the IAB rose again for the first time in almost a year of downward trend. “The employment agencies do not foresee an easy year for unemployment, but the decline in expectations did not continue at the turn of the year,” explains researcher Enzo Weber from the IAB.
The labor market barometer rose by 0.4 points to 99.9 points in December and is currently just below the neutral value of 100. The index is considered a leading indicator of labor market developments and is based on a monthly survey by employment agencies. The scale ranges from 90 points for very poor development to 110 points for very good development. The barometer has been in a steady decline since April, but was still in positive territory for a long time. In September the value then fell below 100.
The labor market is no longer a sure-fire success
Weber summarizes: “The labor market is no longer as self-perpetuating as it was in recent years, but you can still rely on it even in an economic downturn.” For the economic trend to turn around, not only a stable labor market is needed, but also investments in transformation.
Unemployment last fell in November 2023 – as is usual in the autumn months – to 2,606,000. According to the Federal Employment Agency, the decline was very small for November. Accordingly, the unemployment rate fell by 0.1 percentage points to 5.6 percent in November. However, compared to the same month last year, the rate increased by 0.3 percentage points.