Unemployment in Germany continues to fall as consumer confidence hit a nearly five year high, leading companies to take on more people. The Federal Labour Agency said the figures also reflected a seasonal improvement as businesses stepped up hiring after the summer holidays.
The unadjusted jobless total in September – the headline figures used in Germany – fell to 4.24 million from 4.37 million in August. At the same time, the GfK research group’s consumer confidence survey showed Germans are planning to spend more ahead of an rise in value-added tax in January.
GfK’s Klause Wuebbenhorst said: “We see in Germany, January 1 coming with an increase of VAT by 3%, and the closer this date comes, the more the propensity to buy is going to increase. Consumers want to avoid this 3% rise, they are most likely to buy cars, consumer electronics goods and stuff like that.”
However, economists think the buying bonanza could slow down in the new year when VAT goes up from 16% to 19%.