German August Unemployment Probably Rose, Hurting Schroeder
By Friederike Truemper
Berlin, Sept. 2 (Bloomberg) -- German unemployment last month probably exceeded July's three-year high, analysts said, dealing a blow to Chancellor Gerhard Schroeder's bid for a second term in this month's election.
The number of people out of work in Europe's largest economy probably increased by a seasonally adjusted 15,000, according to analysts surveyed by Bloomberg News. In July, unemployment rose 8,000 to 4.1 million.
The economic recovery is faltering. Siemens AG, the largest German manufacturer, said last month it's paring 700 jobs after shedding more than 42,000 in the past two years. Schroeder's Social Democratic Party, trailing the opposition in polls, has failed to cut unemployment, voters' biggest concern.
``Schroeder has done too little for getting the unemployed into jobs,'' said Nina Massek, 27, who completed a master degree in media studies in December with a top grade and has been looking for a job since. She voted for the SPD in 1998 and says she may now cast her ballot for an opposition party.
The German economy grew 0.3 percent in each of the first two quarters this year after shrinking in the second half of last year. The country's biggest association of exporters said Tuesday that gross domestic product will grow 0.5 percent this year as demand from the U.S. dwindles. Factory orders fell in June.
``Our customers are extremely reluctant to place orders,'' said Erik Massmann, chief financial officer at IBS AG, a maker of software for car and drugs companies. IBS, which had a loss in the first half, has shed 10 percent of its workforce since January and postponed hiring plans.
Poll Gap Narrows
The opposition Christian Democratic Union and Christian Social Union have led the Social Democrats in opinion polls since the beginning of the year. The SPD narrowed the gap to two percentage points last week as the government's handling of the worst floods on record boosted its support.
Approval for Schroeder's Social Democrats rose three percentage points to 39 percent, a poll by Infratest Dimap showed Friday. The opposition CDU and CSU held steady at 41 percent, the poll for ARD television found.
That may not be enough to help Schroeder win the election on Sept. 22. The chancellor was last year forced to take back a pledge to lower joblessness to below 3.5 million by the end of this year. The Federal Labor Office will publish August's unemployment report on Sept. 5..
`Decisive for Voters'
``The unemployment issue is decisive for voters,'' said Dieter Roth, the managing director of FG Wahlen polling company, in an interview. ``It's an excellent tool for the opposition to make the government look small.''
Department store owner KarstadtQuelle AG said last week it may shed more jobs after eliminating 7,700 positions in the first half. Bertelsmann AG, Germany's biggest media company, will cut jobs as part of a plan to boost profit and insurer Allianz AG has said it would cut 3,000 jobs at its Dresdner Bank AG unit.
Election posters show Schroeder, sitting at his desk poring over files, saying ``the goal of my work is to create work for everyone.'' A CDU poster features the head of a young woman who says: ``If my boyfriend broke as many promises as the chancellor I would throw him out,'' referring to Schroeder's retracted pledge to reduce joblessness.
By Friederike Truemper
Berlin, Sept. 2 (Bloomberg) -- German unemployment last month probably exceeded July's three-year high, analysts said, dealing a blow to Chancellor Gerhard Schroeder's bid for a second term in this month's election.
The number of people out of work in Europe's largest economy probably increased by a seasonally adjusted 15,000, according to analysts surveyed by Bloomberg News. In July, unemployment rose 8,000 to 4.1 million.
The economic recovery is faltering. Siemens AG, the largest German manufacturer, said last month it's paring 700 jobs after shedding more than 42,000 in the past two years. Schroeder's Social Democratic Party, trailing the opposition in polls, has failed to cut unemployment, voters' biggest concern.
``Schroeder has done too little for getting the unemployed into jobs,'' said Nina Massek, 27, who completed a master degree in media studies in December with a top grade and has been looking for a job since. She voted for the SPD in 1998 and says she may now cast her ballot for an opposition party.
The German economy grew 0.3 percent in each of the first two quarters this year after shrinking in the second half of last year. The country's biggest association of exporters said Tuesday that gross domestic product will grow 0.5 percent this year as demand from the U.S. dwindles. Factory orders fell in June.
``Our customers are extremely reluctant to place orders,'' said Erik Massmann, chief financial officer at IBS AG, a maker of software for car and drugs companies. IBS, which had a loss in the first half, has shed 10 percent of its workforce since January and postponed hiring plans.
Poll Gap Narrows
The opposition Christian Democratic Union and Christian Social Union have led the Social Democrats in opinion polls since the beginning of the year. The SPD narrowed the gap to two percentage points last week as the government's handling of the worst floods on record boosted its support.
Approval for Schroeder's Social Democrats rose three percentage points to 39 percent, a poll by Infratest Dimap showed Friday. The opposition CDU and CSU held steady at 41 percent, the poll for ARD television found.
That may not be enough to help Schroeder win the election on Sept. 22. The chancellor was last year forced to take back a pledge to lower joblessness to below 3.5 million by the end of this year. The Federal Labor Office will publish August's unemployment report on Sept. 5..
`Decisive for Voters'
``The unemployment issue is decisive for voters,'' said Dieter Roth, the managing director of FG Wahlen polling company, in an interview. ``It's an excellent tool for the opposition to make the government look small.''
Department store owner KarstadtQuelle AG said last week it may shed more jobs after eliminating 7,700 positions in the first half. Bertelsmann AG, Germany's biggest media company, will cut jobs as part of a plan to boost profit and insurer Allianz AG has said it would cut 3,000 jobs at its Dresdner Bank AG unit.
Election posters show Schroeder, sitting at his desk poring over files, saying ``the goal of my work is to create work for everyone.'' A CDU poster features the head of a young woman who says: ``If my boyfriend broke as many promises as the chancellor I would throw him out,'' referring to Schroeder's retracted pledge to reduce joblessness.
