The German authorities should take advantage of recent improvements in the economy and employment market, it has been suggested.

In an article for the Wall Street Journal, Klaus Zimmerman explained that proposed changes to labor market legislation by the country's Constitutional Court have led to a debate on reform.

He noted proposals made in Chancellor Gerhard Schroder's Agenda 2010 had addressed future labor supply problems such as an ageing population and state benefits and measures introduced in the document had helped the nation to weather the recent economic crisis, with high levels of participation by both younger and older workers.

According to Mr Zimmerman, director of the Institute for the Study of Labor in Bonn, the number of long-term unemployed in Germany has fallen in recent years, demonstrating "that setting the right kind of incentives can help improve the labor market".

In terms of future challenges, he cited the importance of providing good skilled and non-skilled opportunities for jobseekers, creating apprenticeships and attracting overseas talent to fill vacancies.

Figures from Germany's Federal Statistical Office indicated employment rates rose for the third consecutive month, with the number of people in jobs up in seasonally-adjusted terms by 16,000 to stand at 39.8 million.