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. Last Updated: 07/27/2016

German Unemployment Rate Sets Record, Up to 4.5 Million

NUREMBERG, Germany -- German unemployment set a postwar record in September, with seasonally adjusted joblessness rising by 34,000 from August to 4.497 million, the Federal Labor Office said Tuesday.


The data came as a blow to Chancellor Helmut Kohl a year before a general election. Officials saw little hope the situation would brighten before 1998 despite a strengthening economic recovery.


"The overall figure certainly won't improve before spring next year," said Klaus Leven, labor office vice president.


The data showed the number of unemployed stabilizing in western Germany, but cutbacks in make-work schemes in the ex-communist east had exposed hidden unemployment there.


"It is alarming that this downward trend doesn't stop. The gap between east and west is growing," Leven added.


The labor office revised up its forecast of average 1997 unemployment by around 100,000 to 4.4 million, but said it still had enough funding to cover the cost of jobless benefits.


The seasonally adjusted jobless rate, which best reflects the underlying trend, rose to 11.7 percent in September from 11.6 percent in August.


In western Germany, the number of people out of work on a seasonally adjusted basis rose by 7,000 to 3.054 million in September. The jobless rate was steady at 9.9 percent.


Eastern Germany added 26,000 to unemployment rolls, with the jobless total rising to 1.443 million. The adjusted jobless rate rose to 19.2 percent from 18.8 percent.


Unadjusted unemployment, which dominates news headlines and budget calculations in Germany, fell by 64,000 in September from August to 4.308 million, a rate of 11.2 percent.


Most of that drop came in the west, which has benefited almost exclusively from an export boom.


"My conclusion is that we have a split labor market," said J--rgen Meltzer, an economist at DB Research.