The labor market is continuing its recovery course despite the weakening economy and delivery bottlenecks.

As the Federal Employment Agency announced on Thursday in Nuremberg, the number of unemployed continued to fall in October: by 88,000 to 2.377 million.

The decline was therefore stronger than is usual due to the autumn recovery at this time of year - a sign that the labor market is gradually leaving the Corona crisis behind.

The consequences are still visible, but they are getting smaller, said the chairman of the board, Detlef Scheele.

Britta Beeger

Editor in business.

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Also seasonally adjusted, i.e. taking out the usual seasonal fluctuations, unemployment fell further: by 39,000.

Compared to October 2020, it even decreased by 383,000.

However, the labor market has not yet returned to its pre-crisis level: In October 2019, the Federal Employment Agency (BA) only registered around 2.2 million unemployed.

In their recently published joint forecast, the leading economic research institutes assume that the pre-pandemic level is likely to be reached again in the coming year.

The unemployment rate fell by 0.2 percentage points to 5.2 percent in October.

Companies are hiring more again

The upswing on the labor market has recently mainly been carried by the fact that companies have been hiring more again. According to BA information, the demand for new employees continued to rise in October - the number of registered positions rose to 809,000. According to the Munich Ifo Institute, however, companies have recently been looking for a little less staff. The corresponding employment barometer, which is based on a monthly business survey of around 9,000 companies, fell by 0.7 to 103.6 points. A small damper - nevertheless, the labor market is on a recovery course, commented Ifo researcher Klaus Wohlrabe.

It is noticeable that the willingness to hire remained constant in the manufacturing sector. Because although the industry has a large number of orders, it is currently difficult to process due to the lack of important preliminary products and raw materials. However, the delivery problems are "not yet reflected in the companies' employment policy," said Wohlrabe. The hospitality and construction sectors are also looking for new employees. For the service sector, however, the indicator fell.

The local employment agencies, which are surveyed every month for the labor market barometer of the Institute for Employment Research (IAB), also expect the labor market to continue to develop favorably.

However, the upswing in the next three months is unlikely to be quite as strong as it was recently.

In particular, unemployment is unlikely to fall as quickly as it did after the end of the long lockdown in the spring.

In addition, there were "risks of entrenchment in the form of higher long-term unemployment," said IAB researcher Enzo Weber.

Difficult situation on the training market

In addition to the development of long-term unemployment, the training market is of particular concern at the moment. The situation has improved somewhat compared to 2020, as the large business and chamber associations have just announced. According to this, 2 percent more new training contracts in industry, trade, craft and the liberal professions had been concluded by the end of September than in the previous year. BA boss Scheele said that despite a brightening, the results were very significantly behind those before the pandemic. Great challenges remained.

At around 511,000, the number of training positions reported to the employment agencies is even slightly below the previous year's figure; the same applies to the number of applicants (433,000).

However, the BA assumes that due to the Corona restrictions, many applicants have not registered with the employment agencies and the actual interest in training could be higher.

However, as in the previous year, many apprenticeship positions remained unfilled: at the end of September there were still around 63,000, a little more than 2020. Especially in hotel and restaurant professions, in food production and sales, in health technology and in construction professions, companies had a hard time, apprentices to find.

At the same time, however, more than 24,000 applicants were still unsupported.

This development is particularly worrying because of the demographic development and the enormous demand of companies for skilled workers.

In addition, past experience shows that a slump in the training market is not easy to make up for: the decline after the global economic and financial crisis in 2008/2009 was never made up for.

Rather, the number of new apprenticeships continued to decline almost continuously until 2016.

Only then did it rise again slightly due to the high level of immigration.