The slowdown in the rise in unemployment could indeed be evidence that companies are again more upbeat about the economic outlook. According to the Ifo test, business and export expectations brightened markedly in November.
However, it is still much too early to sound the all-clear on the labor market. Capacity utilization, especially in industry, has declined appreciably in recent months. Prospective stoppage notifications by companies with the Federal Labor Agency have risen notably in recent months, an early indicator of short-time working claims. We expect the seasonally adjusted jobless total to edge up slightly further in the coming months despite a stabilization in the economy. In January and February of next year the unadjusted total is likely to be around 3.2 million. But for 2013 as a whole we still expect unemployment to average slightly below 3 million.