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The labour market in September 2020

effects of the corona crisis still clearly visible despite slight improvement

30 Sep 2020 | Press Release No. 43

“The effects of the corona pandemic on the labour market are still clearly visible, but there are slight signs of improvement”, said the Regional Chairman of the Federal Employment Agency (BA), Daniel Terzenbach, at today’s monthly press conference in Nuremberg.

Unemployed persons in September:                 -108,000 – now 2,847,000

Unemployed persons compared to last year:   +613,000

Unemployment rate compared to last month:  -0.2 percentage points – now 6.2%

Unemployment and underemployment

Unemployment fell in September as the autumn recovery began. The number of unemployed persons currently stands at 2,847,000, constituting a rise of 108,000 compared to last month and a decline of 8,000 if the figures are adjusted to account for seasonal factors. The number of unemployed persons has increased by 613,000 compared to last year. The unemployment rate amongst the overall population rose by 0.2 percentage points to 6.2% from August to September, constituting a rise of 1.3 percentage points compared to the figures recorded in September last year. The unemployment rate stood at 4.6% in August, as calculated by the Federal Statistical Office according to the ILO gainful employment concept.

If seasonal factors are taken into account, there has been a decrease of 26,000 compared to last month with regard to the underemployment rate, which also considers changes in labour market policy and short-term incapacity to work. A total of 3,613,000 persons were underemployed in September 2020 – 462,000 more than a year ago.

Short-time work

Before receiving short-time working allowance for their employees, companies have to report the expected reduction in their working hours. According to the data obtained so far, short-time working arrangements were reported for 85,000 people from 1 to 24 September due to the economic situation, constituting a further drop in the figures.

Data on the actual amount of short-time work is available until July. According to the provisional extrapolated figures of the BA, short-time working allowance was paid out to 4.24 million employees in July. This indicates a gradual drop in the amount of short-time working allowance claimed since the high of 5.95 million in April.

Gainful employment and employment subject to national insurance payments

The economic restrictions imposed to tackle the corona crisis have led to significant drops in gainful employment and employment subject to national insurance payments, but the figures are currently stabilizing at a lower level. According to the Federal Statistical Office, the number of persons in gainful employment (in line with the domestic concept) in August rose by 19,000 compared to the previous month if the figures are adjusted to account for seasonal factors. There are now 44.71 million persons in gainful employment – 597,000 fewer than last year. If the figures are adjusted to account for seasonal factors, employment subject to national insurance payments rose by 5,000 from June to July. According to the extrapolated figures of the BA, there has been a drop in employment subject to national insurance payments compared to last year, as 33.25 million workers were recorded – 106,000 fewer than in July 2019.

Labour demand

The demand for new workers plummeted at the start of the corona crisis and has since stagnated at a low level. 591,000 jobs were registered with the BA in September – 197,000 fewer than last year. If these figures are adjusted to account for seasonal factors, the amount of jobs registered with the BA has increased slightly by 3,000. The BA job index (BA‑X) – an indicator of the labour demand in Germany – remained unchanged at 94 points in September 2020. This puts it 30 points below the level recorded last year.

Cash benefits

1,097,000 persons received unemployment benefits in September 2020 – 378,000 more than a year ago. In September, there were 3,933,000 persons who were fit to work and eligible to receive basic security benefits for job seekers (German Social Security Code II). This represents an increase of 113,000 persons compared to September 2019; 7.2% of people of working age living in Germany were in need of help.

The full monthly report is available online at https://statistik.arbeitsagentur.de.

More information on the effects of the corona pandemic on the labour market can be found here.