Germany's Unemployment Rate Hits 6.4%, Highest Since 2015

Germany's unemployment rate has surged to its highest level since 2015, reaching 6.4% as of January 2025, with nearly 3 million people unemployed. The Federal Employment Agency reported an increase of 187,000 unemployed individuals compared to the previous year, largely attributed to the end of seasonal contracts and adverse economic conditions. The manufacturing sector's downturn, alongside other economic challenges, is prompting concerns among employers, with many indicating plans to reduce their workforces. Industry leaders are calling for reforms to reduce bureaucracy and energy costs to spur job growth. Short-time work arrangements have also seen a significant uptick as companies adjust to declining demand for labor. Upcoming federal elections are expected to focus on addressing these economic challenges and revitalizing Germany's competitiveness.