The euro-area jobless rate in August was 11.5 per cent, unchanged from the previous month, but down from last September’s peak of 12 per cent, the latest Eurostat figures show.
Spain had the highest unemployment rate across the bloc, at 24.4 per cent, and Austria the lowest, at 4.7 per cent.
German joblessness increased unexpectedly in September but the jobless rate remained low and a surge in August retail sales offered hope that private consumption can help prop up Europe’s largest economy in the third quarter.
The number of people out of work rose by 13,000 to 2.918 million - its highest level since January - seasonally-adjusted data showed from the Labour Office showed today.
That confounded forecasts for a drop of 2,000 and overshot the highest estimate in a Reuters poll for a rise of 10,000. But the seasonally-adjusted jobless rate held steady at 6.7 per cent, making Germany the envy of euro zone peers like Spain, where about one in four are still out of work.
Separate data from the Federal Statistics Office showed the number of people with jobs rose by 25,000 to a new record high in August while monthly retail sales rose by 2.5 per cent that month in their sharpest increase in more than three years.
“That’s a pretty good picture at least for the domestic side of the economy and confirms the view that we should see a rebound in the economy in the third quarter on the back of domestic demand,” said Carsten Brzeski, senior economist at ING. The economy shrank by 0.2 per cent in the second quarter and some economists have warned of a risk of recession between July and September, especially as business and investor sentiment has weakened.
“Nevertheless, today’s numbers should not deviate from the fact that the German labour market has probably reached its natural level of unemployment,” he said, adding that structural reforms would be needed to push the jobless rate lower. Some German firms have announced they will trim their workforce recently, with drugmaker Boehringer Ingelheim saying it planned to cut up to 600 jobs in Germany.
While inflation remains moderate in Germany and wages rose in the second quarter, consumer morale fell for a second straight month heading into October as shoppers grew more wary of the impact of international conflicts on the German economy.
Reuters
