Number of employed at 10-yr low in Hungary, jobless rate flat at 10.5% in Q4 2009

The jobless rate in Hungary was last this high in the wake of the fiscal adjustment in 1995. It ticked up to a 14-year high of 10.5% in the previous 3-m period from 10.4% in Aug-Oct and the U-rate became a double-digit figure (10.3%) in the third quarter.

The number of unemployed was 442,100 in Oct-Dec, some 105,000 more than in the same period of 2008 and about 130,000-150,000 more than at the onset of the economic crisis.

For the medium term, though it is good news that the labour market has palpably “toughened up" and fleeing into inactivity, i.e. saying goodbye to jobs as such (e.g. via early or disability retirement) seldom happens. In previous years, people who were let go tended to never look at job ads again, but the fact that this happens no more hints that building up capacities may be an easier thing to do when economic upturn dawns.

It is also good news that the unfazed decline in the number of employed has stopped at the end of 2009.

However, there were still 3.78 m people employed in Q4 last year, about 100,000 less than in the same period of 2008.

Unfortunately, the data is not good enough to draw conclusions from. First of all, the change from the preceding three-month periods is within the margin of error, and secondly we had already seen similar zig-zags even at the deepest point of the crisis. For the time being, we can only say for sure that it was ten years ago when we saw this few people being employed. And the employment rate shows a trendlike decline.

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