German unemployment rose by 60,000 in May, the largest rise in five years, dashing hopes that the employment market was starting to recover from recession.
The number of Germans out of work rose to 4.042 million last month when adjusted for weather and seasonal factors.
"The employment market is still suffering from the weakness in the economy," said Mr Florian Gerster, head of the federal employment office. He had further bad news for Chancellor Schröder yesterday, warning that an improvement in the unemployment figures wasn't likely before the fourth quarter, long after September's general election.
"The economy isn't strong enough yet that the employment market is carried along with it. That will certainly take many months yet," said Mr Gerster.
He said the weakness was due to the ongoing wage disputes in several German industries and the unusually high number of holidays in May.
However, Chancellor Schröder received a vital propaganda weapon for the campaign trail yesterday.
The unadjusted unemployment figure fell under the psychological four million barrier to 3.946 million for the first time this year. A drop in the unadjusted figure is typical for this time of the year but it is still a long way from the 3.5 million unemployed Mr Schröder promised voters by election time. There are 225,000 more people out of work now compared to this time last year.
Yesterday's figures provided further ammunition for conservative politician Mr Edmund Stoiber, who hopes to unseat Mr Schröder in September.
"These figures show that the problem has to be tackled in a completely new way," he said.
He reiterated his plans yesterday to make the German employment market more flexible, to stimulate economic growth and get Germans back to work.
Mr Dieter Hundt, president of Germany's employers federation, dismissed government attempts to talk up the results.
"The flattering smooth-talking of the government is at odds with the facts," he said.
Employers have been affected by expensive work stoppages across Germany's industrial landscape in recent months. Yesterday the construction industry union IG Bau began a series of warning strikes in Hanover and Göttingen after the collapse of wage talks.
More than 30,000 workers walked out in demand of a 4.5 per cent pay rise. On Monday the union will ballot its members on strike action.
Other strikes have hit the postal industry in eastern Germany and banks in the south-western state of Baden-Württemberg.
