Germany's unadjusted unemployment decreased below 3 million in October for the first time in 16 years despite the global financial turmoil and gloomier growth outlook, official data showed.
A report released by the Federal Labor Agency showed Thursday that the unadjusted unemployment fell to 2.99 million in October from 3.08 million in September. This has led to a decrease in the unadjusted jobless rate to 7.2% from 7.4%.
Meanwhile, the seasonally adjusted unemployment fell 26,000 after falling a revised 28,000 in September. Earlier, a 29,000 decline was reported for September. The October decrease was more than double of the expected fall of 10,000. Hence, the seasonally adjusted unemployment rate eased to7.5% from 7.6% in September, while economists were expecting the rate to remain stable at 7.6%.
Analyst at Commerzbank Economic & Commodity Research, Eckart Tuchtfeld said there is bound to be a reaction to the weaker economy and the financial-market crisis before too long. According to Tuchtfeld, there were more unemployed even in the boom years 2000/2001, with the figure never dropping below 3.6 million on an unadjusted basis. Further, the analyst said the German labor market cannot remain unscathed indefinitely by the general economic downturn. In fact, it is more likely to be settling into a gentle decline.
The Federal Statistical Office announced today that the jobless rate fell to a seasonally adjusted 7.1% in September from 7.2% recorded in August. At the same time, the number of unemployed people stood at 3.07 million, compared with 3.10 million seen in the preceding month.
The positive unemployment data came despite the Germany economy showing weakness in the second quarter. The German economy had shrunk in the second quarter for the first time in almost four years. The largest Eurozone economy contracted 0.5% sequentially in the second quarter, after expanding 1.3% in the first quarter. The last time the German economy recorded a decrease was in the third quarter of 2004. The second quarter was characterized by weakness in construction investment and household spending.
The statistical office is scheduled to release first results for the third quarter gross domestic product on November 13. Earlier in the month, the German government had slashed its economic growth forecast for 2009 to 0.2% from 1.2% citing international financial market crisis. However the government was firm on its 2008 growth projection.
Similar to other countries, economic slowdown had slowed inflation in Germany. Wednesday, a preliminary report from the statistical office showed that annual inflation slowed to 2.4% in October from 2.9% in September. In France, inflation slowed as well to 3% in September from 3.2% in August. The French economy had contracted 0.3% quarter-on-quarter in the second quarter after expanding 0.4% in the first quarter.
Germany's business confidence in October deteriorated more than expected to a five year low, a closely-watched survey from the Munich-based Ifo research institute had revealed on October 27.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.