German jobless total tops four million

German unemployment has risen above the critical four million mark in January.

On a seasonally unadjusted basis, there were 4.29 million people out of work, taking the jobless rate up to 10.4% from 9.6% in December. Analysts said the rise in joblessness may not start to reverse before the middle of the year, close to federal elections, scheduled for 22 September.

Chancellor Gerhard Schroederís conservative opponents have attacked the governmentís record on unemployment.

The chancellor had promised to get unemployment down to 3.5 million during his term in office.

Crucial level
The four million mark is psychologically important, but not that high in historic terms.

German unemployment reached its recent peak of 4.8 million in 1998 under Mr Schroederís predecessor, Helmut Kohl.

The government pointed out that, once adjusted for the seasonal factors that play a particularly strong role in January, unemployment was a shade below four million.

The government blames the global downturn, but its critics and many economists say Germanyís over-regulated and inflexible labour market has made matters worse.

Union trouble
Mr Schroeder, critics say, has been too reluctant to pursue labour reforms, which are opposed by his traditional allies in the trade unions. The chancellor has tried to get unions and employers to agree voluntary reforms, but the talks have been deadlocked.

At present, an industrial conflict over wages has banished any hope of agreement before the September election.

German trade unions are demanding pay increases twice, or even three times, higher than the countryís inflation rate.

Rising unemployment could also spell trouble for Germanyís budget, since higher unemployment payments will further bloat the countryís soaring public deficit, already perilously close to the limits laid down in the Maastricht Treaty.

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