German unemployment up again

BERLIN, Germany -- Germany recorded its 12th consecutive monthly increase in unemployment as employers shed staff in response to a shrinking economy.

The number of people unemployed in Europe's largest economy rose on an unadjusted basis in December to 3.964 million from 3.789 million the previous month.

The figure had been at the lower end of pundits' predictions, Reuters news agency said.

The unemployment rate climbed from 9.2 percent to 9.6 percent.

German Labour Office President Bernhard Jagoda predicted on Wednesday the figure will break the four million barrier in January.

"I assume that the jobless level in January will not be below four million," he said.

The jobless rate, adjusted for European Union standards, was unchanged at 8 percent.

Jagoda added the figure for 2002 should dip below four million again.

"If things run according to plan and with a little bit of luck, the average number of unemployed in 2002 will be 3.89 million," he said.

Unemployment averaged 3.852 million in 2001, 37,000 lower than the average level a year earlier.

December's jobless total traditionally surges as building firms, farms, quarries and other outdoor employers lay off workers for the winter.

But the trend has been aggravated by layoffs from German firms, from manufacturing to finance, suffering from recession at home and abroad.

Firms announcing job cuts in December included carbon products maker SGL Carbon and Deutsche Bank, Germany's biggest bank, which said it would cut another 2,100 jobs worldwide in the next 12 months, adding to 7,100 job cuts announced in 2001.

Analysts say some encouraging economic signs do exist.

Confidence among German executives, who shed more than 130,000 jobs last year amid an exports slump, rose in November for the first time in four months.

An increase in factory orders in the same month, led by demand from customers abroad, added to signs the economy may expand this year.

A recession in the U.S. has hurt companies that export or have factories there. In Germany, Europe's biggest exporter, a third of jobs depend on exports.