German job creation slumps

Job creation in Germany continued its downward slide in July, manifesting a persisting trend since February this year, the German Labor Agency said Monday.

The agency's job market index BA-X fell by two points to 162 points - down 17 points from an all-time index high of 179 points, scored in January.

"In view of moderate business prospects, companies have become more cautious about hiring staff," the agency said in a statement.

BA-X reflects the number of jobs reported as vacant by German companies to the Labor Agency. The index is perceived as an important indicator of employment developments in Germany.

Banking sector analysts expect unemployment in the country to climb to 2.85 million people in July - an increase by 10,000 in seasonally adjusted numbers. That represents the fourth consecutive month of rising unemployment in Germany.

However, the figure must be seen in light of record German employment. The Federal Statistics Office (Destatis) said Monday that the number of regularly-employed people, working more than 21 hours a week and paying into the social welfare system, rose by 610,000 in the course of the past year, to a total of 23.7 million people.

Growth in this area, Destatis said, had been stronger than in the temporary employment sector, where 80,000 new jobs had been created and a total of 7.92 million people were employed.

uhe/ncy (Reuters, dapd, dpa)