And this has been accompanied by a continued decline in employment despite an active labour market policy and the creation of early retirement schemes. The German labour market is, if you like, a classic element of an “old economy”.
It is only recently that the dent in growth caused by the Asian crisis has been overcome, that an improvement can be detected on the labour market. The causes of the German labour market problems are primarily structural. This can also be seen by the comparatively large number of long-term unemployed.