Data provided by the Federal Employment Agency (FEA) showed that in February, the unemployment rate (seasonally adjusted) was 5.9%, while the January reading was revised from 5.8% to 5.9%. The latest reading was the highest since May 2021. Economists had expected the unemployment rate to be 5.8%.
Meanwhile, the number of unemployed grew by 11 thousand, to 2.713 million people, after an increase of 1 thousand in January (revised from -2 thousand). Consensus estimates suggested an increase of 7 thousand. In annual terms, the number of unemployed rose by 190 thousand in February.
The report also showed that in February the number of vacancies decreased by 72,000 compared to February 2023, to 706,00 vacancies.
"The weak economic environment is dampening the overall robust labor market," said Andrea Nahles, chairwoman of the FEA.
Last week, the German government warned that momentum in Germany's labor market had waned and would remain low in the first few months of 2024. Germany's GDP is now expected to grow by just 0.2% this year. The revised GDP growth forecast is down from a previous estimate of 1.3%. Meanwhile, the government now anticipates German GDP to increase by 1% in 2025.