West Germany will prove the main engine for growth in Germany's job market in 1997, analysts said in a Reuters poll yesterday, giving the first upbeat assessment on the jobs outlook so far this year.
The German Labour Office will release jobs data for July tomorrow. In June, unemployment rose to a seasonally adjusted 4.37 million, up 11,000 from May. In percentage terms, the seasonally adjusted rate remained static at 11.4 per cent.
Forecasts in the poll ranged from a fall of 15,000 in the pan-German jobless figure to a rise of 10,000, with most analysts expecting a small rise. The jobless rate was seen in a range of 11.1 per cent to 11.4 per cent.
Germany's jobless figures soared to record highs at the start of this year, leading both politicians and the public to view unemployment as the country's number one problem.
The welfare cost to budget coffers of the lengthening jobless queues has added to fears Germany may not hit spending goals set for entry European monetary union, stating deficits should be no more than 3 per cent of gross domestic product.
The data this time was expected to show particular weakness in eastern Germany, partly due to a special factor - the expiry of some job creation schemes.
Mr Ulrich Beckmann of Deutsche Bank Research, who predicted an unchanged jobless figure, said: "The west is better than the east. In the west the economy is growing again, the number of hirings is increasing.
"The east will under-perform, mostly because of the end of the ABMs (employment creation schemes), which will neutralise both developments," he said.
His counterpart at WestLB in Duesseldorf, Mr Thomas Kull, said: "I hope the figures on Wednesday will show there has been a turnaround in the west. In the east we don't think it's happened yet."
