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Business

Germany wins more jobs year on year

Germany's employment figures for December were better than those from the previous year, the federal jobs agency has reported. Despite a lot of uncertainty, the labor market is still very robust, it says.

During the fierce debate in 2014 over whether Germany should introduce a minimum wage, conservative free-market economists painted a dark, dramatic picture of the likely consequences, arguing that millions of low-wage jobs could be priced out of the market and destroyed.

 But it just hasn't happened. Two years after the minimum wage was introduced in January 2015, the nation's employment rate continues to rise. The number of permanent job contracts has also been rising steadily, with precarious short-term zero-hours contracts in relative decline.

The latest good news on the jobs front in Germany came in an announcement on Tuesday morning by the federal employment agency: In December, 2.568 million people were registered as unemployed and taking benefits - 104,000 fewer than a year before (December 2015).

The average unemployment rate over 2016 as a whole, as it is measured by the agency, declined by 0.3 percent compared to 2015, and was down to 6.1 percent - the lowest rate for 25 years.

Thema Windenergie Arbeiter bei der Fertigung eines Generators (Rexroth)

A Rexroth technician doing finishing work on a wind turbine generator

There is always an annual decline in employment during the winter months relative to the warmer months, with fewer jobs in construction, agriculture, and other weather-affected industries during the cold season. This winter is no exception, but the decline this past December was milder than usual, with just 36,000 more people having registered for unemployment benefits in December compared with November.

Different ways of measuring employment rates

It's worth noting that different agencies have different ways of measuring unemployment rates. For example, whilst the German federal jobs agency measured an unemployment rate of 6.4 percent for the country in 2015, Eurostat, a European statistics agency, using different criteria, reported a German unemployment rate of 5.0 percent for 2015.

A more detailed and clearer picture can be obtained by looking at employment rates rather than unemployment rates, and at the numbers of people in full-time work compared to the number in part-time work. For 2015, the federal employment office counted 68.7 percent of employed people as employed in "standard employment," which means they worked at least 20 hours a week and paid into social security accounts. The remainder were in "non-standard" employment, such as temporary work or self-employment.

In 2015, the number of people in 'standard employment' who were working full-time was 21.4 million, out of a total of 36.16 million employed adults.

Germany's labor force participation rate - the percentage of all adults in work - was 60.50 percent in 2016, slightly lower than the record high of 60.70 percent achieved in 2014.

The situation for Germany's youth employment figures is broadly positive as well, with a youth unemployment rate of 6.8 percent, in stark contrast to Spain, for example, where the figure is 42.6 percent.

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