BERLIN (dpa-AFX) - The number of unemployed individuals continued to increase in October as companies continued to cut their labor force in a bid to cut costs, in turn weakening expectations of domestic demand supporting economic growth.
The number of unemployed increased by 20,000 in October from a month ago, data from the Federal Labor Agency showed Tuesday. The figure is almost double that of the 10,000 increase expected by economists and follows an increase of 12,000 each in September and August.
On the other hand, on an unadjusted basis, the number of unemployed individuals decreased to 2.75 million from 2.79 million in September.
At the same time, the seasonally adjusted jobless rate stood at 6.9 percent, in line with forecast, and unchanged from September.
The weaker economic situation is having a noticeable impact on the labor market, said Frank-Juergen Weise, head of the Labour Office. Nonetheless, the labor market is robust and in a good shape.
Today's numbers provide further evidence that the labor market is gradually losing steam, suggesting that the cushioning impact on the economy should peter out in months ahead, said ING Bank NV's economist Carsten Brzeski.
But he says the lack of qualified employees and still strong labor demand in domestic sectors as reasons to make the current slowdown a very gentle one.
Recent surveys reinforce the assessment of weak economic activity. Confidence amongst German businesses declined to a two-and-a half year low in October, as companies assessed their business situation as worsening, the Ifo institute said last week.
Early this week, the central bank said the economy is likely to stagnate or even contract slightly in the final quarter of the year after marking a noticeable expansion in the third quarter.
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