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A trend reversal for German employees is emerging cautiously. August saw no crown-related rise in unemployment for the second month in a row. Although more people were looking for work again, the number increased by 45,000 to 2.96 million. But this is common in the summer because, for example, apprenticeships are running out and companies hire fewer employees during the vacation period. Seasonally adjusted, the number of unemployed fell by 9,000.
Experts also see an improvement. For the Munich-based Ifo Institute, a turnaround in the German labor market is imminent: “After layoffs in recent months, now the first signs of new hires have emerged.” Enzo Weber of the Institute for Employment Research (IAB) said: “Unemployment has caught up.” Starting in September, companies typically rehire more employees depending on the season.
“However, the effects of the pandemic on the labor market are still very clearly visible,” said the president of the Federal Employment Agency (BA), Detlef Scheele. Compared to the previous year, there are finally 630,000 more unemployed. Short-time work is still important in preventing unemployment, but according to preliminary data, short-time benefits were only paid to 5.4 million employees in June, which is a positive sign. In April it was six million.
In industry, half of the companies participating in the Ifo Institute’s business trends survey still use this instrument. For hotels or travel agencies there are many more. After several major aid programs, the federal government just decided to extend the short-time work allowance until the end of December 2021.
Economic researchers expect growth
How things will continue in the labor market now depends largely on the development of the economy. From April to June, the German economy plummeted almost 10 percent compared to the first three months. The economy is now recovering. The German Institute for Economic Research (DIW) expects growth of 3.5 percent in the third quarter from July to September. Researchers have recently revised their forecast upward a bit. At the same time, DIW economist Claus Michelsen is lowering expectations: “Even a strong lead in the third quarter is not enough to overcome the crisis. It will be with us for a long time.” In some places, you can still see a start from a standstill and not normal economic growth. “It shouldn’t be so lively in the later course.” Currently, the greatest risk is that a second large wave of infections will force a severe restriction of economic activity again.
There is a significant delay in learning due to the corona pandemic. As of August, around 100,000 applicants remained unplaced, but at the same time there were even more openings. According to the Federal Agency, there will still be a lot to do in the apprenticeship market at the end of September.
