Persistent labor shortages in Hungary, jobless rate at 3.7 pc

Hungary’s rolling average three-month jobless rate stood at 3.7 percent between March and May, down from 3.8 percent in the previous period and down from 4.4 percent in the same period a year earlier, the Central Statistical Office (KSH) said on Thursday.

The rate covers unemployment among those between the ages of 15 and 74.

In absolute terms, there were 170,600 unemployed in Hungary in the period, 6,400 less than in February-April and 32,500 less than in the same period a year earlier.

The unemployment rate among young adults between 15 and 24 years of age stood at 8.8 percent, down 2.1 percentage points from a year earlier. The age group accounted for about one-sixth of all unemployed, KSH noted. The rate edged down in the 25-54 age group by 0.4 percent to 3.5 percent, and among those between 55 and 74 years, to 2.5 percent by 1.5 percentage points, KSH said.

Jobseekers spent about 17.9 months on average looking for employment during the period. About 45.3 percent of the unemployed had been seeking work for one year or longer.

The number of employed Hungarians during the period stood at 4,457,400, up 12,100 from the previous three-month period and up 64,300 compared to one year earlier. The employment rate was 62.2 percent, slightly up from 62.1 percent in the previous period and up from 61.5 percent from a year earlier.

The employment rate in March-May was at 70 percent for men and at 55 percent for women.

The number of employed included 161,600 Hungarians in fostered work schemes and 107,900 working abroad.

The number of those employed on the domestic primary labour market rose by 2.7 percent from a year earlier, while the number of fostered workers dropped by 20.3 percent. The number of those working abroad was down 2.5 percent.

As we already reported, Hungary struggles hard with labour shortage which affects almost every sector of the economy. According to the latest data, there are 80 thousand unfilled workplaces in Hungary. The situation is getting worse in construction and industry, but there are considerable problems in transport, as well – reported the Hungarian Central Statistical Office (HCSO). Furthermore, the situation worsened in the info-communication and the service sector, read more HERE.

Commenting on the data, Finance Minister Mihály Varga told public television that employment in the 15-64 age bracket has grown steadily since 2010. Thanks to economic growth,

overall unemployment is at a historic law,

he said. Government schemes creating workplaces continue to improve jobseekers’ and job changers’ chances, he said.

The government is continuing to work on increasing the number of pensioners and women with children in employment, both through funding and by expanding possibilities of part-time employment, Varga said. Rising costs on wages do not hamper growth but help fostered workers to enter the primary labour market, he said. The six-year wage deal concluded between the government, employees and unions at the end of 2016 also boosts wages, development and investment, he said.

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ING Bank chief analyst Péter Virovácz said

companies still managed to hire people despite growing labour shortage.

Rising wages are pushing some towards activity but the market is only absorbing jobseekers that have been out of work for less than a year. For the rest of the year the unemployment rate could remain around its current level, he added.

Analyst András Horváth of Takarékbank said the economy was nearing full employment as the unemployment rate could drop to around 3 percent by the end of summer and average 3.4 percent for the year. Horvath said there was still room for a 4-5 percentage point improvement in the national employment rate which could translate into 250,000-300,000 new jobs until full employment is reached.

K and H Bank chief analyst Dávid Németh said the unemployment rate is at a low point and the 3-4 percent rate corresponds to full employment in the current economic environment.

Photo: MTI

Source: MTI