BERLIN (MNI) – German Labor Minister Ursula von der Leyen said
Wednesday that despite the Eurozone debt crisis there is no reason to
dispair about the domestic labor market, stressing that the biggest risk
is currently a lack of skilled labor.

“All robust, credible data do not signal a downward development,
rather to the contrary,” von der Leyen said at a press conference here.
“Currently, the lack of skilled labor is a bigger risk than the [debt]
crisis.”

In a separate statement, Economics Minister Philipp Roesler said
that “all leading indicators for the labor market do not signal an end
to job growth.”

Roesler pointed to a sustained economic development which is
increasingly supported by rising private consumption. “There are good
conditions for the German economy to cope with the slowing of the global
economy in the winter half-year,” he argued.

Unemployment resumed its downward path in November, while job
vacancies continued to grow, the Federal Labor Office reported earlier
today, citing seasonally adjusted data.

Some 2.913 million persons were actively searching for work in
November – the smallest number since November 1991 – down from 2.933
million in October, reducing the unemployment rate by 0.1 percentage
point to 6.9%.

The Berlin-based DIW economic research institute said earlier today
that it expects fourth quarter GDP to contract by 0.2% on the quarter,
mainly due to slowing industrial production.

“The euro crisis is increasingly impacting on the German economy,”
said DIW chief economist Ferdinand Fichtner. “Thus, one cannot rule out
further negative growth in the first quarter of 2012.” This would be
then a technical recession, he pointed out.

The uncertainties regarding the outlook for the Eurozone will not
only hurt exports in the short term but also equipment investments and
consumption, the DIW predicted.

However, the institute does not expect a demand shock as seen in
the winter of 2008/2009, Fichtner said. Businesses can cope with a
temporary demand drop without laying off staff in large numbers, he
noted.

“If uncertainties fade next year, then the German economy can play
out its strength and profit from still sound growth in the emerging
economies,” the chief economist reasoned.

–Berlin bureau: +49-30-22 62 05 80; email: twidder@marketnews.com

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