German jobless rate holds steady in April

Germany's unemployment rate stayed stable at six percent in April, the federal labour agency said Thursday, even as a third coronavirus wave forced new restrictions in Europe's top economy.

Although the country's joblessness rate remained unchanged for the fourth consecutive month, seasonally adjusted figures showed the number of unemployed actually rose slightly by 9,000 people.

In raw numbers, less representative of underlying trends but more closely followed in public debate, the number of people out of work fell by 56,000 to just over 2.77m.

"The labour market is developing solidly. The ongoing restrictions in many areas are slowing down the recovery, but are not leading to new burdens" on the jobs market, said Detlef Scheele, head of the BA federal labour agency.

Before the pandemic struck last year and idled entire sectors of the economy, Germany's unemployment rate had hovered at record lows of around five percent.

The country managed to stave of mass layoffs by relying heavily on subsidised short-time work schemes known as  "Kurzarbeit" in German.At the peak of the health crisis last April nearly six million Germans were placed on reduced hours. That figure has fallen to around 3.2m people currently, yet the number  "has been rising steadily" again in recent months, the agency said.

Germany's bars, restaurants, leisure and cultural centres have been closed since November, but the country has struggled in recent weeks to contain an uptick in Covid-19 cases fuelled by the more contagious British virus variant.

The government this month introduced new  "emergency brake" legislation to enforce tougher restrictions in hard-hit regions, including renewed closures of non-essential shops, night-time curfews and school closures.

The German economy is projected to have shrunk by 1.8 per cent over the first quarter of 2021, according to forecasts by economic institutes.

But a faster pace of vaccinations and Germany's resilient export-reliant manufacturing industry are expected to help the country return to growth this year.

The German government on Tuesday lifted its 2021 forecast and is now expecting 3.5 per cent full-year growth, up from 3.0 per cent previously.