German April jobless up more than expected

German unemployment rose more than expected in April, as companies continued cost cutting while they wait for growth in Europe…

German unemployment rose more than expected in April, as companies continued cost cutting while they wait for growth in Europe's biggest economy to accelerate.

The seasonally-adjusted jobless total rose by 23,000 from the previous month to 4.367 million, the third straight gain, the Federal Labour Office said. The adjusted jobless rate edged up to 10.5 per cent, from 10.4 per cent in March.

"Company executives already see a global upswing but they are still cautious in terms of hiring," said Mr Joerg Kraemer, chief strategist at Invesco Asset Management in Frankfurt.

"The true upward trend in unemployment has become visible again because economic growth is too weak," he added.

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The April jobs figures reflect the continuing weakness in Europe's largest economy, still struggling to regain momentum after three years of stagnation, analysts said. Government reforms of the labour market have yet to boost job creation.

The German government, which had been counting on stronger growth this year, last week trimmed its 2004 growth forecast to 1.5 per cent from a previous target corridor of 1.5-2.0 per cent and said surging oil prices could threaten even this lower figure.

Germans worried about losing their jobs have been reluctant to spend on big consumer items, hitting domestic demand.

The Bundesbank has estimated that German gross domestic product grew around 0.25 per cent in the first quarter of this year, compared with the previous three month period, much too slowly to stimulate new job creation.

In non-adjusted terms, the jobless total fell by 104,000 from March to 4.443 million, to leave an unadjusted jobless rate of 10.7 per cent.