German unemployment tops 3 million in July, Bavaria hits near-20-year high

National figures

Germany's Federal Employment Agency (BA) reported 3.007 million people out of work in July, an increase of 71,000 from June and 28,000 from July 2025. The unemployment rate rose 0.2 percentage points to 6.4 percent, compared with 6.3 percent a year earlier. The three-million mark had last been exceeded in April 2026, when the total stood at roughly 3.008 million. Seasonally adjusted, the number of unemployed edged up by 6,000, indicating that most of the monthly jump was driven by regular summer patterns.

Overall, the weak development of recent months continues on the labour market.

Seasonal effects

July typically brings a rise in joblessness as school-leavers and graduates register with the agency before starting training or employment in the autumn. Many firms also delay hiring during the holiday period, and fixed-term contracts often expire at the end of the second quarter. The BA expects the numbers to retreat in September once the summer pause ends. Nevertheless, the underlying trend remains weak: the number of registered vacancies stood at 653,000, subdued by historical standards, and 1.108 million people were drawing unemployment benefits, up from a year earlier. The number of employable recipients of the Bürgergeld basic income fell, but the system still reflects a porous boundary between work, top-up benefits and social security.

Regional disparities

The national picture masked wide variation across the federal states. Bavaria recorded 318,025 unemployed, the highest July figure in almost two decades. The state's rate was 4.1 percent, the lowest in the country but still up 0.1 points from June. Markus Schmitz, head of the Bavarian regional directorate, called the level "a high-water mark for a July" and noted that unemployment had last been higher in that month in 2007.

Bremen posted the steepest rate at 11.4 percent, while Hessen saw its jobless count climb by around 6,700 to 215,021, pushing the rate to 6.0 percent. In Thüringen, 71,152 people were without work, a rate of 6.5 percent, unchanged from a year ago. The state did report a 10.4 percent monthly rise in new job vacancies, but long-term unemployment accounted for 35.6 percent of the total. Lower Saxony counted 282,143 unemployed (rate 6.2 percent), and Schleswig-Holstein roughly 96,800 (rate 5.9 percent). In Hamburg, agency head Sönke Fock cited holiday-related hiring delays, non-renewal of training contracts and the economic slowdown as the main drivers.

Training market strains

The transition from school to work is becoming more difficult. In Hessen, roughly 35,000 young people were seeking an apprenticeship in July, but only 27,600 positions were on offer. Frank Martin, the regional director, said companies were cutting back on investment amid uncertain conditions and that "employment opportunities have deteriorated markedly across all qualification levels."

Employers in the north warned that the readiness of school-leavers for vocational training was declining. The metal and electrical industry associations Nordmetall and AGV Nord said they would probably fill nine out of ten apprenticeship places this year, but only with "enormous effort." The number of trainees in the sector had risen by about 6 percent between 2023 and 2025 to around 10,200, but the associations argued they were reaching their limits.

Companies are already making enormous efforts to enable young people to enter working life. But they cannot permanently compensate for what has been missed in schools and career guidance.

Economic backdrop and reactions

The BA's Terzenbach acknowledged the seasonal pattern but stressed that the labour market was continuing its months-long weak trend. The Spiegel report cited high energy prices resulting from the Iran war, structural weaknesses in German industry, and an ageing workforce as persistent drags. The DGB trade union federation called for stronger social protection, with Michael Rudolph, chair of DGB Hessen-Thüringen, rejecting employer demands to shorten the duration of unemployment benefit.

Especially in economically difficult times, employees must be able to rely on the welfare state to protect them.