According to some, the job crisis in Europe is the worst since the 1930s.

The German government's report offered scant optimism that the situation will improve soon. Germany's high labor costs and expensive social programs, some of the most costly in the world, have hindered the country's competitiveness against other nations in a global economy.

Much of the country's economic turmoil can be traced to the unification of East and West Germany. In the former West Germany, burdensome taxes have slowed investments, hindering the introduction of technological advances. In the east the $700 billion transferred from the west has helped rebuild a crumbling infrastructure but hasn't generated jobs. In some regions up to half of the workforce is idle.

Further souring the public mood are austerity measures intended to cut state deficits and satisfy requirements for a common European currency (the euro) by 1999. Germans increasingly dislike the notion of surrendering the Deutschmark to embrace an untested European currency. Recent surveys show that only 31 percent favor the new currency, and most fear an erosion of their living standard under the new economic system.

The head of the federal labor office, Bernhard Jagoda, sees no signs of imminent improvement ahead. He estimates that the number of unemployed workers at near 4.5 million and growing—some 11 percent of the work force. (Source: The Washington Post.)