— Oct -9k, Sep -15k, Aug +10k, Jul +25k, Jun +4k, May +14k, Apr +17k

FRANKFURT (MNI) – German payrolls fell for the second consecutive
month in October to their lowest level since June, while the jobless
rate held firm at 5.4%, the Federal Statistical Office reported
Thursday.

October’s 9,000 decrease lowered the seasonally adjusted number of
employed to 41.524 million. In unadjusted terms, payrolls continued to
climb, rising 0.3% on the month to a record 41.87 million.

The ranks of the unemployed contracted by 19,200 persons in October
to 2.27 million, 5.4% fewer than one year ago.

The relatively resilient labour market continues to support
consumers’ willingness to spend, the latest GfK survey showed. “High
employment curbs fears of job losses and therefore inspires planning
security, especially when it comes to making larger, more expensive
purchases,” the market research firm said.

Recent indicators suggest stronger headwinds for employment in the
near future. The Ifo institute’s employment barometre fell for the
fourth consecutive month in October. “Companies remain very cautious
about hiring new staff,” Ifo noted.

November’s PMI poll was more alarming, showing the fastest decline
in private sector jobs since early 2010 on the back of a marked decrease
in the services sector (47.4).

The European Commission expects employment to expand by just 0.2%
next year after +1.1% this year, as firms take advantage of flexible
working-hour programs amid slowing demand.

“In the coming quarters, firms are expected to make use of this
flexibility once again, implying a reduction in working time and leaving
scope for a small expansion of employment,” the Commission said in its
Autumn Economic Outlook. “In the course of 2013, working time is
projected to recover.”

The Organisation for Economic Cooperation and Development is more
pessimistic, forecasting employment to fall 0.1% in 2013 after a 1.1%
rise this year. Employment is expected to recover by 0.2% in 2014.

At 8:55 GMT today, the Federal Labour Office will publish
unemployment figures for November. The median forecast in an MNI survey
of analysts is for a further rise of 17,500 persons, while the jobless
rate is seen unchanged at 6.9%.

— Frankfurt bureau: +49 69 720 142: email: twailoo@mni-news.com —

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