German unemployment hits highest level in 12 years as 2026 looks challenging

Germany's average number of unemployed rose by 161,000 to 2.948 million in 2025, the highest annual total since 2013. The labour office said 2026 will remain challenging and that any easing is unlikely before mid-year.

Germany's labour office reported that the average number of unemployed in 2025 rose by 161,000 to 2.948 million, the highest annual figure since 2013. Labour office head Andrea Nahles said 2026 will be a year of noticeable challenges and that a slight easing is not expected before mid-year at the earliest. The labour office also reported that the seasonally adjusted unemployment rate remained at 6.3% at year end. Key facts: - The average number of jobless people in 2025 was 2.948 million, up 161,000 from the previous year. - In December, unemployment rose by 3,000 on a seasonally adjusted basis and the jobless rate was 6.3%. - There were 619,000 job openings in December, 35,000 fewer than a year earlier, and analysts note skill shortages persist despite rising unemployment. - The labour office expects Germany's potential labour force to fall by about 40,000 in 2026 due to demographic factors; reporting also noted improved employment integration for some refugee groups. Summary: The labour office and independent economists reported a weaker labour market at the end of 2025 and said the situation is likely to complicate economic recovery and private consumption in 2026. Undetermined at this time.