Swiss Unemployment Rises to Highest Since July 2006

Swiss unemployment rose to the highest in almost three years in April as falling demand prompted companies to cut jobs., Bloomberg 5/8/2009 8:56:53 AM

The seasonally adjusted jobless rate increased to 3.4 percent from 3.3 percent in March, the State Secretariat for Economic Affairs in Bern said. That was the highest since July 2006.

Switzerland’s jobless rate may rise further as the global economy shrinks and sales of products from watches to chemicals decline. Clariant AG, which is cutting more than 1,350 jobs, reported a first-quarter loss this week on slumping demand in the automotive, leather and textile industries.

The number of people seeking jobs rose 1.4 percent to 194,726 in April from the previous month, according to today’s report. Companies had 12,397 job vacancies, down 660. In unadjusted terms, the unemployment rate rose to 3.5 percent in April from 3.4 percent.

Seasonally adjusted, 134,790 people were without a job in April, 5,570 more than in March.

The Swiss National Bank forecasts that the economy will shrink by as much as 3 percent this year, which would be its biggest contraction since 1975. Swiss exports declined in March for a second month and a KOF report this week said that capacity utilization among manufacturers fell to the lowest in three decades in the first quarter.

In order to revive growth and ward off deflation, the SNB has reduced interest rates to near zero, purchased corporate bonds and is buying foreign currencies.

Recent data suggest the economies of Switzerland’s main trading partners may be starting to stabilize. A measure of European manufacturing rose to a six-month high in April, while factory orders in Germany, Europe’s largest economy, unexpectedly increased for the first time in seven months in March.

Still, as unemployment lags the economic development,” the jobless rate may rise to as high as 4.5 percent next year.

Swiss Unemployment Rises to Highest Since July 2006