German Economy Minister Wolfgang Clement was quoted as saying it will take four or five years until new labour market reforms reduce unemployment to a "halfway tolerable level," a newspaper reported on Sunday.
Earlier this month, Germany's upper house of parliament approved plans to cut jobless benefits and put the unemployed under more pressure to accept work, paving the way for the reforms to take effect as scheduled on January 1, 2005.
Asked by the Frankfurter Allgemeine Sonntagszeitung how long the reforms would take to have an impact, Clement said:
"In four or five years we'll have reduced unemployment to a halfway tolerable level, provided we get the necessary economic growth. Nothing will work without economic growth."
Clement, who recently said Europe's largest economy could expand by between 1.5 and two percent this year, added that growth of 1.5 percent was a prerequisite for new job creation.
Asked by the paper when he thought the number of German jobless would dip below the four million mark, Clement said:
"In a month-on-month comparison, next year at the latest, in terms of an annual average, it'll take a bit longer."
In seasonally adjusted terms, Germany had 4.37 million unemployed in June and, in unadjusted terms, 4.23 million.
Last weekend Frank-Juergen Weise, head of Germany's Federal Labour Office, said there was no guarantee the new labour reforms would help get the long-term unemployed back to work.
Most of the country's leading economic think tanks recently raised their 2004 growth forecasts to around 1.8 percent, as strong export growth has boosted Germany's efforts to emerge from three years of economic stagnation.
However, the adjusted rate of unemployment is well over 10 percent, and has held at 10 percent or above since October 2002. Analysts see job fears as the biggest obstacle to a turnaround in weak consumer spending, deemed the Achilles' heel of the German economy.
Clement added that 2005 could see stronger economic growth in Germany than had previously been forecast.