Germany's unemployment rate dropped to 9.1% in May and the number of people out of work fell to a 5 1/2-year low amid a sustained pickup in Europe's biggest economy, government figures showed Thursday.
The unadjusted jobless rate was down from 9.5% in April, the Federal Labor Agency said. The number of people registered as unemployed fell by 161,000 to 3.806 million -- 732,000 people fewer than a year earlier and, the agency said, the lowest level since November 2001.
"The economic upswing in Germany is continuing and is further stimulating the labor market," labor agency chief Frank-Juergen Weise said.
In seasonally adjusted terms, however, the jobless rate held steady at 9.2%. The number of people without work rose by 3,000 in May, but that was still lower than the rise of 20,000 that analysts polled by Dow Jones Newswires had predicted.
It was the first increase in seasonally adjusted figures for 13 months, but UniCredit economist Andreas Rees said that was simply because seasonal workers had been hired earlier this year, amid warm spring weather.
"The latest figures are not the first signs of a trend reversal on the labor market," Rees said.
A long-awaited improvement in Germany's economy has filtered through to the labor market over recent months, with the total number of unemployed falling below 4 million for the first time since 2002.
Germany was plagued for several years by near-zero economic growth and double-digit unemployment.
The jobless rate peaked at 12.6% in February 2005, when the number of Germans out of work reached a post-World War II record of 5.216 million.
Since then, the country's economy has been buoyed by increased exports and by German consumers' increased willingness to spend. Business, investor and consumer confidence surveys are all soaring.
The German government is forecasting economic growth of 2.3% this year, while the Paris-based Organization for Economic Cooperation and Development is forecasting 2.8% growth.
Rees said that, with summer approaching, the jobless rate likely would fall further.
"There is little doubt that the recovery on the German labor market will keep on rolling this year," he said in a research note.
"In all probability, the number of jobless will shrink at an above-average speed once again in the coming months, as the momentum is simply very strong and the weather effect will soon be 'digested.'"