German unemployment edged higher to 8.7 per cent of the workforce in February as a total of 3.643 million people were without jobs, the Federal Labour Agency said yesterday.

In January, unemployment in Europe's biggest economy had been 8.6 per cent, according to unadjusted data that serves as a reference for public debate.

"Effects of the economic crisis on the labour market also remained moderate in February," agency board member Heinrich Alt said in a statement.

Germany has managed to limit the increase in unemployment despite suffering its worst post-war recession last year, with state subsidies that allowed for shorter working hours at a little below normal pay levels.

Changes in the way of calculating the number of unemployed have also helped to limit increases but the effect of those changes will soon disappear from comparisons.

ING senior economist Carsten Brzeski nonetheless said that "the horror scenarios of exploding unemployment remained what they were: scenarios."

"The labour market should continue to be the bright spot of the German economy and tender positive surprises should not be excluded," he added.

Analysts polled by Dow Jones Newswires had expected the number of unemployed adjusted for seasonal factors to climb by 5,000 this month, but that figure rose by a slightly stronger 7,000, the labour agency reported.