The number of unemployed is rising faster than expected

Seasonally adjusted unemployment rose to 4.367 million in April, up by 23,000 from March.

In April, the seasonally adjusted unemployment rate stood at 10.5%, up from 10.4% in March.

"The situation on the labour market has got gloomier," said Frank-Juergen Weise, head of the Labour Office.

"Economic growth is too weak to boost the labour market.

"At the same time, the short-term positive effects of job creation schemes and other measures, faded."

Analysts had expected unemployment to rise, but not this much.

When statistical measurements that make the German figures comparable with statistics from other European countries are used, the German unemployment rate rose from 9.7% in March to 9.8% in April.

The news will increase pressure on the European Central Bank to cut interest rates - something German politicians have been urging for a long time.

It will also increase the unease in Germany over the recent expansion of the EU eastwards, as many German companies have been relocating factories and jobs in the former Eastern European countries.

Unemployment is the biggest millstone around the neck of the Schroeder government which is expected to face a tough time this year in a string of regional and local elections.