Germany's seasonally adjusted unemployment rate rose to 6.3% in March 2025, reaching its highest level since September 2020, up slightly from 6.2% in February and surpassing forecasts of 6.2%.
Germany unemployment rate at 2020-highs
The number of unemployed individuals increased by 26,000, reaching a total of 2.922 million, which was a larger rise than the expected 10,000 increase. This uptick in unemployment reflects the ongoing challenges in the labor market, despite seasonal trends. March traditionally marks the start of the so-called "spring recovery" in the labor market, when employment conditions typically improve as businesses ramp up hiring after the winter months.
Economic slowdown hits recovery
However, as Anja Nahles, the head of Germany's Federal Employment Agency, pointed out, this year's economic downturn has notably slowed down what would normally be a more pronounced recovery. "This year, the economic slump is noticeably slowing it down," Nahles explained, acknowledging the broader economic slowdown that continues to weigh on labor market conditions. While the spring recovery typically offers a boost, the current economic climate has created headwinds, resulting in slower-than-usual improvements in employment. This slower recovery may reflect ongoing challenges in key sectors, with global economic pressures, domestic demand issues, and labor market uncertainty contributing to the weaker-than-expected growth in job creation.
