Angela Merkel, leader of the Christian Democrats (CDU), and Edmund Stoiber, leader of the Christian Social Union (CSU) have written to Schröder proposing their parties join forces to develop immediate strategies to combat joblessness.

"Continuing with business as usual is not an option," they said, urging the government to accept their "Ten-point Plan for Germany."

In Yemen, Schröder responded positively to their offer, but rejected aspects of their proposals including the relaxing of laws protecting German employees from dismissal.

"Anyone who thinks dismissal protection law is the main obstacle to new appointments shows they have little understanding of the real problem," he said.

He also insisted their help should be unconditional. "If their willingness to talk comes with certain conditions, they are laying themselves open to accusations of playing games that the people of this country do not need given their problems," the chancellor said.

Election campaign tied to reducing joblessness

After their disappointing results in the northern state of Schleswig Holstein in February, Schröder's Social Democrats are pinning their hopes on the May poll in North Rhine-Westphalia, Germany's most populous state and a traditional SPD stronghold. The result is expected to indicate the outcome of the 2006 general election.

But data published Tuesday shows that unemployment in the state has topped the 1 million mark, excacerbating public anger at the government's failure to trigger job growth.

"We say to our friends in Berlin, you have to persevere and create more impulse for growth despite the difficult budgetary situation," Harald Schartau, the SPD leader in North Rhine-Westphalia said on German television.

Nationwide, 5.22 million people are looking for work -- a rise of 177,000 over January, and more than half a million above the figure at the same time last year, according to figures released by the Federal Labor Agency

Pressure on Berlin to unveil new job creation schemes is mounting.

With nearly 13 percent of the workforce currently unemployed, Germany is seeing its highest jobless rate since the 1930s.

"The figures can be explained"

Chancellor Gerhard Schröder, currently on a tour of seven Gulf States, took time out in Quatar on Wednesday to comment on the latest figures.

"There's no doubt that the unemployment figures are depressing," he said. "But we can't allow ourselves to be forced on the defensive. The figures can be explained. In January alone 360,000 people who had been on social support payments were included in the jobless totals."

Some 75 percent of February's 180,000 additions to the total figure can be seen as the result of a reclassification system introduced in January, with many benefit claimants added to the list for the first time thanks to new rules.

ILO statistic less bleak

The government can also now point to a new statistic calculated using standards set by the International Labor Organization (ILO), which does not count the long-term unemployed or people who work just a few hours a week.

"We are now publishing a new monthly unemployment figure based on ILO standards, in addition to the figure calculated in the traditional way," said Economics Minister Wolfgang Clement.

This figure put unemployment at just under 4 million, well below the politically sensitive 5 million mark.

Cross-party cooperation

Other contributing factors to the apparent rise in joblessness are the weak economy and the current cold weather, which has badly hit the hitting the construction industry.

But while Berlin insists its efforts to tackle joblessness with the controversial "Hartz IV" labor market reforms need time to take effect, the conservative opposition argues the government needs to change tack.

"We need a program to bolster medium-sized business and a program for lower energy costs," argued Angela Merkel. "We must do more to stimulate innovation and bring about labor market reforms."