* Adjusted jobless rate drops to lowest since April 1992
* Adjusted jobless total falls 40,000, 15th drop in a row
* Part-time work programme becoming less important
By Christian Kraemer
NUREMBERG, Germany, Sept 30 (Reuters) - Germany's unemployment rate fell to its lowest level in more than 18 years in September as companies, little fazed by a cooling in the economy's record recovery, continued to hire.
The firm job market appears to be lifting consumer morale and domestic demand as well as traditionally solid exports in Europe's largest economy.
Federal Labour Office figures released on Thursday showed
the jobless total fell by 40,000 in September from the previous
month to a seasonally adjusted 3.146 million, double the drop
expected in a Reuters poll of economists.
The fall was the 15th drop in a row and took the adjusted jobless rate down to 7.5 percent from 7.6 percent in August. That was also the lowest level since April 1992, according to Bundesbank figures.
"Labour market conditions will continue to improve in the months ahead. Second-quarter GDP data has shown that not just exports but also domestic demand is recovering strongly now," said Timo Klein, senior economist at IHS Global Insight.
"Numbers in short-time work are on the decline and temporary employment is already more or less back at pre-crisis levels of mid-2008 again."
Government subsidies that encourage firms to shift employees to part-time work rather than fire them during the global downturn have helped keep German unemployment largely in check.
But the part-time work programme, known as "Kurzarbeit", was now becoming less important, the Office said. In July, some 288,000 employees benefited from Kurzarbeit subsidies, 111,000 fewer than in the previous month.
German consumer sentiment is likely to rise going into October to its highest level since may 2008, the GfK market research group said on Tuesday. [ID:nBZNRKE612]
RECOVERY
Driven by exports, Germany has recovered quickly from its deepest post-war recession last year, but a gloomy outlook in some of its main trading partners means growth is beginning to slow from the 2.2 percent reached in the second quarter.
Economists now widely expect German economic output this year to expand by at least 3 percent.
Officials have said joblessness will likely fall below the key 3 million mark this year and employment will reach its highest level since reunification in 1990, further fuelling the recovery. [ID:nLDE68F0XO]
On Thursday, German steel employers and the IG Metall labour union agreed to a 3.6 percent pay rise from October for 85,000 workers, averting further strikes by a union emboldened to push for raises after a period of muted pay demands.
Steelmaker ThyssenKrupp's
German engineering orders in August rose 45 percent in real terms from the previous year, industry association VDMA said earlier on Thursday. [ID:nBAF004282]
And figures released earlier by the Federal Statistics Office showed the number of people in work in Germany rose by 2,000 on the month in seasonally adjusted terms. [ID:nBAF004280] (Additional reporting by Sarah Marsh in Berlin, writing by Annika Breidthardt; Editing by Hugh Lawson)