Germany’s Unemployment Rate Expected to Decline as Economic Recovery Strengthens

Economic growth

GERMANY: Germany’s unemployment rate is projected to decline over the next two years as the long-awaited recovery of Europe’s largest economy gains momentum. Government forecasts indicate that unemployment will ease from 6.3% in 2025 to 6.2% in 2026, before falling further to 6.0% in 2027.

In August, the number of unemployed individuals surpassed three million for the first time in a decade, reflecting the prolonged economic weakness that began with the COVID-19 pandemic and was exacerbated by Russia’s invasion of Ukraine. However, according to official projections, the unemployment figure is expected to gradually decrease to an annual average of around 2.8 million by 2027.

Germany’s Economy Ministry has also slightly upgraded its growth outlook, now expecting the economy to expand by 0.2% this year, up from a previous forecast of zero growth. The ministry anticipates stronger momentum ahead, with growth projected at 1.3% in 2026 and 1.4% in 2027.

Source: Government of Germany