The Labour Market in November 2020

Further seasonally adjusted decline in unemployment despite partial lockdown

01 Dec 2020 | Press release no.51

“The labour market reacted to the restrictions in November – but fortunately without an increase in redundancies so far. However, companies are once again being more cautious in their search for personnel and have announced short-time working for significantly more employees in November,” said Detlef Scheele, Chairman of the Executive Board of the Federal Employment Agency (Bundesagentur für Arbeit – BA), today at the monthly press conference in Nuremberg.

Unemployment Rate in November: -61,000 – now 2,699,000

Unemployed persons compared to last year: +519,000

Unemployment rate compared to last month: -0.1 percentage points to 5.9

Unemployment and underemployment

Unemployment fellmore sharply in November compared with the previous month than in previous years. At 2,699,000, the number of unemployed is 61,000 lower than in October. Seasonally adjusted, it decreased by 39,000. Compared to the previous year, the number of unemployed increased by 519,000. The unemployment rate fell by 0.1 percentage points to 5.9 percent from October to November, but was up 1.1 percentage points compared to the figures recorded in November last year. The unemployment rate determined by the Federal Statistical Office according to the ILO employment concept amounted to 4.4 percent in October.

If seasonal factors are taken into account, there has been a decrease of 42,000 compared to last month with regard to the underemployment rate, which also considers changes in labour market policy and short-term incapacity to work. The total underemployment in November 2020 was 3,520,000 people. That is 385,000 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 current data on verified advertisements, 537,000 people were notified of cyclical short-time working from November 1 to 25. The significant increase compared to the previous month can be explained by the partial lockdown in place since the beginning of November.

Current data on actual job utilisation is only available up to September. According to preliminary extrapolated data from the Federal Employment Agency, 2.22 million employees were paid cyclical short-time work compensation in September. This indicates a gradual drop in the amount of short-time working allowance claimed since the high of almost 6 million in April.

Gainful employment and employment subject to national insurance payments

With the economic restrictions in the wake of the coronavirus crisis, employment and the labour force have decreased significantly, but recently stabilised at the lower level. According to the Federal Statistical Office, the number of employed persons (according to the domestic concept) in October, seasonally adjusted, increased by 20,000 compared to the previous month. At 44.93 million people, it was 645,000 lower than in the previous year. Seasonally adjusted employment subject to social security contributions increased by 31,000 between August and September. According to BA projections, employment subject to social security contributions fell by 143,000 to 33.80 million employees in September compared to the previous year.

Labour demand

The demand for new labour fell massively at the beginning of the Corona crisis, but has recovered noticeably in recent months. The impact of the partial lockdown in November is felt in the form of a flattening of the increase, mainly due to fewer new reported jobs. In November, 601,000 jobs were reported to the BA, 136,000 fewer than a year ago. If these figures are adjusted to account for seasonal factors, the amount of jobs registered with the BA has increased by 11,000. The BA job index (BA X) – an indicator for the demand for personnel in Germany – rose by 1 point to 99 points in November 2020. This is 21 points below the figure for the previous year.

Cash benefits

1,036,000 people received unemployment benefits in November 2020, 314,000 more than a year ago. In November, the number of people eligible for benefits under the basic provision for job-seekers (SGB II) was 3,793,000. Compared to November 2019, this was an increase of 34,000 people. This means that 7.0 percent of people of working age living in Germany were in need of assistance.

Training market

During the post-placement period on the training market for an immediate start to training, 61,000 young people (around 11,000 more than last year) were seeking training between October and November. This contrasted with 70,000 registered company-based training places, 8,000 more than in the previous year. 31,000 applicants, roughly half, were still unprovided for and another 20,000 were still looking for a training place despite the existence of alternatives. At the same time, 25,000 training places were still unfilled.