A SURGE in German unemployment of more than half a million in a month left Mr Guenther Anders standing in the rain in this small eastern town yesterday, bleakly confident of one thing - he would never work again.

He is almost certainly right. As Germany struggles with the worst levels of joblessness since the 1930s, eastern towns like Bautzen are sunk in bitterness and gloom. The bulk of the middle aged generation feels it has been written out of the jobs equation, while young people complete apprenticeships only to join the lengthening dole queues.

"I suppose I'm what you'd call an early pensioner," said Mr Anders, 54, a joiner and former factory hand out of work for four years. "Nowadays here it's all short term contracts and part time work. There's such insecurity. There's no hope."

The pan German jobless figures soared to an official 4.66 million in January, the federal labour office announced yesterday, stunning politicians, analysts and the media. The figure, unadjusted, was more than half a million up on December, an increase of 1.4 to 12.2 per cent.

The new record figures come at a critical time for the country, for Chancellor Dr Helmut Kohl and for Europe generally. Even if the German economy is flagging, it remains Europe's powerhouse in the run up to monetary union.

However, if the unemployment rate of around 11 per cent in western Germany is alarming enough, in the former communist east, the official figure of 18 per cent masks the real picture.

In the Saxon town of Bautzen near the Czech border, the unemployed figure yesterday was a numbing 21 per cent. The shops and cafes, bars and restaurants were virtually deserted as people felt the pinch.