With around 180,000 unemployed on an annual average, the Hessian labor market recovered again in 2021 with lower unemployment figures than in 2020.

Despite further lockdown phases and the ongoing pandemic, but also the supply chain crisis, unemployment fell by 3.7 percent compared to the average of the previous year.

The unemployment rate in December recorded a decrease from 5.4 to 4.6 percent compared to the same month of the previous year.

The number of unemployed has fallen from around 158,000 to just over 157,000.

That emerges from the figures presented on Tuesday by the regional directorate of the Federal Employment Agency.

Patricia Andreae

Editor in the Rhein-Main-Zeitung.

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Employment subject to social security contributions did not increase as strongly as in the previous months, but still exceeded the previous year's figure of October 2020 by 1.4 percent.

This means that the number of these employees in Hesse is still above the pre-crisis level.

"In particular, the stabilizing effect of the short-time work allowance has significantly reduced the risk of becoming unemployed in the past year," commented Bettina Wolf, operational manager of the Hessen regional office, on the figures.

The short-time work contributed significantly to the fact that many people were able to keep their jobs.

Events, travel and hospitality industries hard hit

On the employers' side, the development is not only seen as positive. "The upswing on the labor market is here, but it is shaky," says Dirk Pollert, General Manager of the Association of Hessian Business Associations. In the past few months, the manufacturing sector has had to cut jobs mainly due to persistent raw material and supply chain problems. "And around 8,000 Hessian companies with 100,000 employees are still being supported with short-time work benefits," he adds.

"The advertisements for short-time work have been increasing noticeably since December," confirms Bettina Wolf.

Omikron is dragging the corona crisis longer, but the employment agency now has the experience, instruments and financial resources to react to sudden changes and to process the notifications and applications for short-time allowance very quickly.

The travel and hospitality industries as well as the events industry and the related trades are hardest hit.

Ending a grip on the social coffers

In view of the current situation, the entrepreneurs are concerned about the coalition agreements of the Berlin traffic light government.

Too many new burdens were to be expected, according to Pollert.

With a view to the plans for a minimum wage of 12 euros, he says that this will reduce “the employment opportunities that are really urgently needed for the low-skilled and the long-term unemployed”.

In view of the improved situation, the DGB Hessen-Thuringia points out that “the division on the labor market between well-paid, secure work and precarious work in wage poverty continues”.

The union accuses the employers of reaching into the social security funds for years in order to top up unworthy wages.

“This has to come to an end,” demands the Hessian DGB district chairman Michael Rudolph.

For employers, however, in view of the increasing shortage of skilled workers, it is initially more important to get people into work.

Instead of the planned further easing of basic social security benefits, the employers' associations are calling for the principle of 'support and demand' to be retained, so that only those people who really need it receive state aid ”.

Pollert adds: "On the other hand, we expressly welcome improved crediting of additional earnings and the introduction of de minimis limits, which relieve job centers of bureaucracy."

"More vacancies than unemployed skilled workers"

The issue of long-term unemployment also worries the job centers. Because, as Bettina Wolf reported, this group could hardly benefit from the positive trend. Of the roughly 180,000 unemployed in Hesse, around a third had been without a job for at least a year. Thus they belonged to the group of the long-term unemployed. "Of these, around 11,800 people have been unemployed for four years or more," says Wolf. According to Wolf's reasoning, this is also due to the fact that the employment agency was only able to organize training offers or employment projects to a lesser extent during the crisis.

More offers are planned for this year in order to be able to "build on the positive development in promotion and qualification from before the crisis". “We know that companies are primarily looking for skilled workers and less unskilled helpers,” explains Wolf. "There are significantly more vacancies than unemployed skilled workers not only in sectors such as nursing or in some craft trades."

And the demand for labor continues to grow. With 50,520 vacancies, the number of vacancies at the Hessian agencies shows a significant increase compared to the previous year. Monthly access fell by 4.5 percent to around 11,100, but was still 18.3 percent higher than in the same month last year. This is a remarkable development that can only be countered with qualification and further training, said Wolf. It recommends companies that are looking for skilled workers to invest more in the training and further education of their own staff, and guarantees the support of the Hessian employment agencies for this purpose, there are numerous programs for this. “The smaller the company, the greater the financial support,” says Wolf.

Overall, the regional directorate of the employment agency expects a further increase in jobs subject to social security contributions and a further decline in the number of unemployed, as Frank Martin, the head of the regional directorate, recently said.

"The only real risk for the labor market would actually be large-scale and long-lasting corona lockdowns."