Unemployment in Germany has risen above three million for the first time in ten years, fuelling pressure on the government to deliver results from its massive investment programme.

Figures released by the Federal Labour Office on Friday showed that 3.02 million people were unemployed in August in seasonally unadjusted terms, up by 46,000 from July. The seasonally adjusted jobless rate remained unchanged at 6.3%, in line with expectations.

Labour office head Andrea Nahles said the labour market “is still shaped by the economic slump of recent years.” Germany has been struggling with sluggish growth, and concerns are mounting that US tariffs introduced by President Donald Trump could push the economy into a third consecutive year without expansion — something not seen before.

Labour demand is also weakening. There were 631,000 job openings in August, 68,000 fewer than a year earlier. Labour Minister Baerbel Bas blamed “global economic uncertainties and Russia’s war of aggression against Ukraine,” warning that cyclical headwinds were weighing heavily on Europe’s largest economy.

The German government is trying to counter the slowdown with a €500 billion special investment fund for infrastructure, made possible by loosening fiscal rules. But many economists argue that while the boost is significant, the impact will take years to filter through. Business groups say deeper reforms are needed to tackle structural weaknesses in the economy.

“Three million unemployed is a damning indictment of the refusal to reform in recent years,” said Rainer Dulger, president of the BDA employers’ association, who called for a sweeping “autumn of reforms.”