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Tuesday, 9 April, 2002, 12:03 GMT 13:03 UK
German unemployment falls
People waiting for the unemployment centre to open in Berlin
The jobless figure could fall significantly by the summer
The number of people out of work in Germany has dropped for the first time in 15 months.

Unemployment fell by 8,000 in March to 3.968 million, according to seasonally adjusted figures from the Federal Labour Office.

The more politically sensitive headline figure fell 140,000 to 4.156 million, or 10% of the workforce.

The head of the Labour Office, Florian Gerster, said he expected unemployment to fall significantly by June or July, but he warned that the jobs market would not show any real signs of recovery until later in the year.

Mr Gerster, who is a member of Chancellor Schroeder's Social Democrats, said there had been a drop in unemployment because the government's new employment policies were helping people to get back to work.

Unemployment promise

Chancellor Schroeder will be keen to claim any credit for a reduction in the number of jobless people.

Chancellor Gerhard Schroeder
The figures could help Chancellor Schroeder's election prospects

He faces a general election in September, and problems with the economy and rising unemployment have damaged his opinion poll ratings.

Chancellor Schroeder had originally promised to cut unemployment to 3.5 million during his four year term of office, but he revised the forecast, saying the global economic slowdown made the goal impossible to reach.

Insolvencies rise

The falling unemployment figures come after a string of company failures which have put jobs at risk.

As many as 10,000 workers could lose their jobs at the media group Kirch, which has declared itself insolvent.

Two other big companies, the building firm Philip Holzmann and the stationer Herlitz, have also declared themselves insolvent, threatening thousands more jobs.

There were 32,000 insolvencies in Germany in 2001, 14% more than the year before.

Experts believe the number could rise to 40,000 this year.

See also:

09 Apr 02 | Business
Schroeder pledges to save Kirch jobs
26 Mar 02 | Business
German business confidence grows
27 Feb 02 | Business
German recession confirmed
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