Unemployment in Germany surpasses 3 million mark for the first time in a decade

In a concerning development for the German economy, the unemployment figure for August 2025 has risen to 3.025 million people, according to the Federal Ministry of Labor. This represents an increase of 46,000 compared to July 2025 and 153,000 higher than in August 2024.

Seasonally adjusted, the number of unemployed in August was 9,000 lower than in July 2025. However, the rise over three million is the first time since February 2015 that this threshold has been exceeded. The ongoing economic slowdown in recent years and summer effects are cited as the primary reasons for this increase.

The unemployment rate in Germany also rose to 6.4%, matching the highest level since March 2025 when it reached 6.3%. This rate has been consistently increasing since September 2020, marking a steady upward trend.

The unemployment rate and economic downturn may be impacting the German labor market. Economists believe that addressing Germany's structural problems will require years, while German Chancellor Friedrich Merz considers the unemployment situation to indicate the need for reforms.

The Bureau of Labor Head, Andrea Nales, commented that the German labor market is still affected by the economic downturn of recent years. The increase in unemployment can be seen as a symbolic threshold between economic strength and weakness, according to ING Bank's Head of Macroeconomics, Karsten Brzeski.

Inflation in August increased to 2.1%, higher than the 1.8% recorded in July. This rise, coupled with a decrease in job vacancies, suggests a potential economic slowdown. In August 2025, 631,000 job vacancies were opened, a decrease of 68,000 from the previous year.

Tariffs imposed by US authorities may lead to a third year without growth for the first time in the country. The increase in unemployment and the economic slowdown could have far-reaching implications for the German economy and its citizens.

As the situation continues to evolve, it is crucial for policymakers to take action to address these challenges and support the recovery of the German labor market.