German unemployment rose by a sharp 44,000 in seasonally adjusted terms in March amid continued weakness in Europe's largest economy, official data showed this morning.
Economists said the rise, which exceeded market expectations, showed that despite some reforms, the underlying problems in the jobs market of Europe's largest economy have still not been tackled.
"The labour market situation has worsened against the backdrop of a continued weak economy," the Federal Labour Office said in a statement. "On a seasonally adjusted basis, employment in January has fallen noticeably and unemployment in March risen sharply."
The rise in seasonally adjusted unemployment to 4.344 million was well above the mid-range forecast. The March jobless rate rose to 10.4 per cent compared with the consensus for an unchanged 10.3 per cent.
February's adjusted jobless total was revised up to 4.300 million from an originally reported 4.293 million.
The news contrasted with the latest signs of strong employment growth in the United States, where non-farm payrolls rose last month at the fastest pace in nearly four years.
Germany's government has predicted 2004 will mark a return to growth after three year's of stagnation, predicting the economy could grow 1.5 to 2 per cent.
However, economists do not expect to see any impact on the labour market until the second half of the year, and some are beginning to scale back their own forecasts in the light of signs a recovery may already be running out of steam.