The professor from the University of Regensburg told public broadcaster ZDF Europe’s largest economy would likely shrink by 2.0 to 2.7 percent this year, causing a surge in unemployment.

The mass redundancies would be a sharp reversal for the German labour market, which showed remarkable resiliency in 2008.

The number of people working in Germany last year rose to an all-time high since the country’s reunification, even as the economic crisis set in, official figures showed on Friday. With Europe’s biggest economy in the midst of what might be a protracted recession, the lagging indicator will likely begin to fall back this year, however.

An annual average of 40.35 million people were employed in Germany, an increase of 582,000 or 1.5 percent from the figure in 2007, the Destatis statistics service said.

“The increase in employment in 2008 reached its highest level since German reunification” in 1990, Destatis said in a statement.

Germany’s economy grew through the first half of last year but fell into recession in the second and is likely to remain there for much or all of 2009, economists forecast.

“The economic slowdown which has set in now did not have a major impact on the annual employment because the labour market reacts with some delay to changes in short-term economic trends,” Destatis noted.

Last year’s employment increase was also less than the 1.7 percent gain of 2007. Most of the growth was seen in services, represented hiring of salaried workers. The number of self-employed increased 0.3 percent, Destatis said.