German Chancellor Gerhard Schroeder's efforts to rescue his stalled re-election bid this week are likely to be overshadowed by voters' number one concern - unemployment.

Schroeder's Social Democrats officially launched their summer campaign tour and unveiled their battle bus in Schroeder's home town Hanover yesterday, seven weeks before the September 22 general election.

The SPD ramped up their campaign 18 days earlier than planned after failing to make inroads into the five to seven point lead of the opposition conservatives in opinion polls.

Yet they have little time to set the agenda before the release of the latest data on German unemployment and the July numbers are unlikely to do the incumbent any favours.

The head of Germany's Federal Labour Office, Florian Gerster, said last week there were no grounds to be optimistic about the July figures, although he hinted that reports of a sharp rise may be exaggerated.

The mass-circulation Bild newspaper has reported that headline unemployment in Europe's largest economy would rise to 4.1 million in July from 3.954 million in June.

Other important numbers, the opinion polls figures, gave Schroeder little joy last weekend.

One opinion poll showed the lead of the conservative CDU/CSU increasing by one percentage point, while two others showed the gap unchanged. The SPD were making inroads into the lead until a triple whammy of jobless data, the sacking of Defence Minister Rudolf Scharping and allegations of meddling in the affairs of Deutsche Telekom struck early last month.

Schroeder must hope his campaign, which will take him to 47 towns and cities across the country will draw out those that backed for him in 1998 and win over floating voters.

Manfred Guellner, director of the Forsa polling institute, said about 30 per cent of voters remained undecided and it was too early to dismiss the election as a lost cause.

Richard Hilmer, head of the Infratest institute, likewise believed the 2002 race was still open.

"There's certainly a lot of dissatisfaction about the Social Democrat-Green government, but also scepticism that the conservatives can do things better... There's still at least a quarter of the electorate unsure," Hilmer said.

Hilmer said the SPD was wise to take to the road early and to play their trump card, Schroeder, who continues to lead conservative challenger Edmund Stoiber in popularity polls.

"A lot of people will be making up their minds in the final weeks... Then personalities will come to the fore," he said.

The SPD are also hoping to boost support by stressing opposition to a possible US attack on Iraq. At the weekend, Schroeder cautioned against a US strike during a party rally.

Stoiber's foreign policy spokesman Wolfgang Schaeuble slammed him for making the issue a campaign theme at a time when the international community should be pressuring Baghdad into opening up to weapon inspections.

The Social Democrats' junior coalition partners, the Greens, were also due to hit the road this week, with the start of the tour of their leading figure, Foreign Minister Joschka Fischer.

The Greens are also the first party to put up election posters, its message spread across the capital over the weekend.

The Greens will hope they deflect some attention from a scandal over misuse of airmiles. Another leading Green admitted over the weekend he had used bonus points from official trips for a long-haul private flight, breaking parliamentary rules.

On Sunday, Fischer said in a television that as crimes go, it was far from the funding scandals that had struck other parties. Germans also appear to believe so, 79 per cent of those polled by Forsa saying it should not be a sackable offence.

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