German jobless figure rises

German seasonally-adjusted unemployment rose by 17,000 in December, a source with knowledge of the data told Reuters, as advance effects of 2005 changes to labour market regulations boosted jobless rolls.

The Federal Labour Office published the official data, but the increase exceeded the mid-range forecast of economists polled by Reuters for a gain of 10,000 (EUROLANDJAN).
Headline unadjusted unemployment, which the German media typically focuses on, increased 206,900 on the month to 4.46 million, with the rate rising to 10.8 percent from 10.3 percent in November, the source said.
Jobless numbers usually rise at the start of winter as builders and other firms that employ outdoor workers lay off staff. But the data this month is also likely to have been complicated by the early effects of new jobless benefit rules which came into effect in January.
The rules, which oblige social welfare recipients to register as unemployed, are expected to lift the official total while economic growth remains sluggish.
"The rise is a bit more than we'd expected, but it's essentially a continuation of what we've been seeing for the last few months," said Helaba economist Stefan Muetze.
"It stems from the fact that growth is still too weak to effect a turnaround on the labour market. I don't expect we'll see the trend reverse in the next few months."
The government's official growth forecast for 2005 is 1.7 percent, although many economists consider that optimistic.
Economy Minister Wolfgang Clement has said that no significant turnaround on the labour market is expected before the second half of next year.
But he believes the so-called "Hartz IV" labour market reforms launched this year will help to cut the jobless rate to between 3 and 5 percent by 2010 from over 10 percent at present.