Turning point: unemployment on the rise in Hungary
In September, 185,000 people were unemployed in Hungary, still a slight decrease compared to the same period last year, but an increase compared to previous months and the third consecutive month of unemployment growth. Already, the number of unemployed has increased by 25,000 from a low of 160,000.
The 3-month moving average of unemployed people rose to 178,000 from a low of 157,000 a few months ago, also a leap of more than 20,000. The unemployment rate rose to 3.8% for September, while the 3-month average leapt to 3.6%. These are still lower than we saw in the same period last year, but represent a substantial increase from the 3.3-3.5% levels seen during the spring and summer.
The worsening economic outlook and the energy crisis therefore seem to be slowly reaching the domestic labour market.
The number of people employed was 4,712,000 between July and September, and around 4,700,000 in September, a slight decrease compared to the previous months.
In early September, Portfolio reported that unprecedented labour shortages could abate soon, and low unemployment, reflecting full employment, could rise in the coming months as the economy deteriorates.
According to a recent survey by local think tank GKI, labour shortages are becoming less of a problem for companies, while lack of demand has started to catch up as a major concern, also pointing to a slowdown in the economy. And recent figures from the stats office already show a modest rise in unemployment, which is unfortunately not too surprising given the news of restaurants, hotels and other services closing in recent weeks.
Unemployment could easily rise further in the winter months as the energy crisis hits companies harder. The government is trying to break this negative trend by providing low-interest loans, extending the interest rate freeze to business loans and the factory bail-out programme. The government's measures will certainly slow the deterioration, but they cannot reverse it in the short term in the event of a deeper recession.
Cover photo: Getty images
