BERLIN (March 28): The number of people out of work in Germany rose in March at the fastest rate since October of 2024, data showed on Friday, as an economic malaise puts pressure on the job market even against a backdrop of long-term labour shortages.

The office said the number of unemployed increased by 26,000 in seasonally adjusted terms to 2.92 million. Analysts polled by Reuters had expected that figure to rise by 10,000.

The seasonally adjusted jobless rate rose to 6.3% from 6.2% the previous month, slightly higher than a forecast of analysts polled by Reuters.

"March marks the start of the so-called spring recovery on the labour market. This year, however, the economic slump is noticeably slowing it down," said Andrea Nahles, the head of the labour office.

Smarting from two consecutive years of decline in 2023 and 2024, Europe's largest economy is still battling with persistent weakness and structural headwinds in industry.

The number of unemployed people in Germany has not been above three million over the last 10 years.

There were 643,000 job openings in March, 64,000 fewer than a year ago, showing a slowdown in labour demand, the federal labour office said.

The dire economic situation is reflected in the country's storied auto industry, with Volkswagen and others cutting jobs on weak demand.

Adding to automakers' burdens, US President Donald Trump announced on Wednesday a 25% tariff on imported vehicles to the US.

Germany is in the immediate firing line, said Gaurav Ganguly, director of economic research at Moody's Analytics.

"If the policy remains in place, the consequences for consumer confidence and employment in the auto sector and beyond are severe," Ganguly said.

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