Germany sees lowest unemployment in 20 years

BERLIN -- Despite worldwide economic turmoil, 2011 saw Germany produce record-setting lows in unemployment rates. Could the German recovery model serve as an example for others?
Written by Shannon Smith, Correspondent (Berlin)

BERLIN -- Germany enjoyed its lowest unemployment rates in 20 years in 2011, according to the German Federal Employment Agency (BA).

"The German employment market showed overall positive development during 2011," chairman of the BA Frank-J. Weise said Wednesday, citing an average unemployment rate of 7.1 percent for the entire year.

"Unemployment sank significantly, paid work and positions subject to social security contribution grew strongly, and the total demand for employees was high the entire year."

The news comes at a difficult time for many job markets around the world with bi-continental debt crises and various other forms of economic woe threatening global economic stability. Despite the turmoil, Germany has managed to keep up positive GDP growth, as well as its positions as the strongest economy in the European Union (EU) and the world's second largest exporter after China.

The country's Economic Minister Philipp Roessler called it "the most successful year by far for employment seekers since East and West Germany reunited," according to Berlin's daily Der Tagesspiegel.

"We expect the employment upswing to continue through the coming months, albeit at a slower rate."

Der Tagesspiegel quoted the Confederation of German Employers as citing the "productivity-orientated and differentiating collective-bargaining policy, as well as important reforms and more flexibility" as the reasons for the country's outlying employment success. Barring setbacks from the sovereign debt crisis, the organization said it also sees the improvement continuing through 2012.

Though the numbers seemed like reason to celebrate for many, some of Germany's traditionally skeptical public figureheads were quick to point out flaws in the facts. Der Tagesspiegel reported that Claus Matecki, head of the German Federation of Trade Unions (DGB), said more action should be taken than the numbers suggest: "It's better than expected, but not altogether satisfactory."

"When more than 100,000 over-age-58 social security recipients aren't even showing up in the statistics because they have not had a job offer in over a year, the numbers are a farce," Matecki said, suggesting that the statistics had been intended to exaggerate a positive picture of the German job market.

Opposition to Roessler's Free Democratic Party (FDP) also cast doubt upon the numbers. There is no reason "to look through rose-colored glasses and get too comfortable with inaction," Der Tagesspiegel quoted Social Democrat Party (SPD) representative Hubertus Heil as saying.

The BA reported growth in nearly all sectors with the highest demand for skilled labor appearing in mechanics, electronics, energy, metal, logistics, mechanical engineering and health. Despite anticipated growth, BA also says it expects unemployment to rise slightly in January, as is usually the case.

Photo: Flickr/Photocapy

This post was originally published on Smartplanet.com

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