Full employment in the old federal states reached its peak in 1970, when only 150,000 were out of work. At the same time almost 800,000 job vacancies were reported. During the recession in the 1970s, the labor force diminished and the number of unemployed increased. It rose above one million in 1975, and to well over two million at the beginning of the 1980s. Government policy in the western part of the country after 1982 initially improved the conditions for economic growth and considerably reduced the obstacles to employment. By 1991 unemployment there had dropped to 1.7 million, but - largely as a consequence of the 1992/1993 recession and the period of sluggish growth that followed - it began to rise again, reaching an average of 2.8 million in the year 1996. Some 1.4 million new jobs were created between 1984 and 1989 and a further 1.8 million between 1989 and 1992 in the western part of Germany. Between 1992 and 1996, however, the number of jobs decreased by about 1.3 million, primarily as a consequence of the general economic downturn and continuing structural problems.

In the former GDR there was always full employment - at least that was the official version as presented by the GDR regime. In fact, however, there was much concealed unemployment, estimated at between one and a half and three million. The full extent of the problem became apparent when Germany was united and the ruined GDR economy collapsed. A host of government initiatives at first prevented a relatively sharp increase in visible unemployment there, but old, unproductive jobs have been written off faster than new ones have been created. For a transitional period, therefore, the Federal Institute for Employment has expended considerable government funds to finance early retirement, short time, job creation measures and vocational further training programs, reducing the number of unemployed by up to more than two million. In 1996 about 800,000 persons were still benefiting from these supportive measures and programs.