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CEE region, unemployment going up "matter of time"
Impact of pandemics on job loss still relatively visible
30 May, 14:25
(ANSA) - BELGRADE, 30 MAG - (by Stefano Giantin)
The impact of the pandemics on the labour market in Central- and
Eastern Europe (CEE region) is still not fully visible in
unemployment statistics, but "increase in unemployment rate
seems just matter of time," said Erste Group Research in a new
report.
The labor market in Croatia, Austria, Bulgaria, Czechia, Hungary, Slovenia, Slovakia, Poland and Romania "may seem barely affected by the virus" if compared with a dramatic increase in unemployment rate within a very short period of time for instance in the US and in part of Europe, the report said, noting that in March the increase in unemployment rate in Central- and Eastern Europe "was hardly noticeable in most of the countries in the region" with the exception of Austria.
However, "the discrepancy between the labor market impact in the US and European countries lies most likely in labor market flexibility". In the CEE region, "the termination of a contract is lengthy and the notice period in the case of permanent contracts is usually counted in months." For this reason, Erste said, "March layoffs would thus be visible in the unemployment statistics with a couple of months delay." In general, in Czechia, Hungary, Poland, Slovakia and Romania, the unemployment rate did not change almost at all in March. The increase in April was marginal in Czechia, Hungary and Poland (0.1-0.4%) and in Slovakia (1.4%). In Croatia, the number of unemployed the increase of the unemployment rate to 9.4% came only in April, Erste said. In the next months, with an "unavoidable" recession, the unemployment rate will to double digits in Croatia, Romania and Serbia (between 10 and 12%), while in Hungary, Poland and Slovakia, Erste expects a 2pp to 3pp increases of average unemployment rates to around 7 % in Hungary, 7.5% in Poland and 9.5% in Slovakia.
According to the report, countries in the region "with high employment in accommodation" and tourism "or food services are likely to see faster or higher increases in the unemployment rate." The possibility of teleworking should on the opposite reduce the negative impact of coronavirus on employment, in particular in countries like Austria. (ANSA).
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The labor market in Croatia, Austria, Bulgaria, Czechia, Hungary, Slovenia, Slovakia, Poland and Romania "may seem barely affected by the virus" if compared with a dramatic increase in unemployment rate within a very short period of time for instance in the US and in part of Europe, the report said, noting that in March the increase in unemployment rate in Central- and Eastern Europe "was hardly noticeable in most of the countries in the region" with the exception of Austria.
However, "the discrepancy between the labor market impact in the US and European countries lies most likely in labor market flexibility". In the CEE region, "the termination of a contract is lengthy and the notice period in the case of permanent contracts is usually counted in months." For this reason, Erste said, "March layoffs would thus be visible in the unemployment statistics with a couple of months delay." In general, in Czechia, Hungary, Poland, Slovakia and Romania, the unemployment rate did not change almost at all in March. The increase in April was marginal in Czechia, Hungary and Poland (0.1-0.4%) and in Slovakia (1.4%). In Croatia, the number of unemployed the increase of the unemployment rate to 9.4% came only in April, Erste said. In the next months, with an "unavoidable" recession, the unemployment rate will to double digits in Croatia, Romania and Serbia (between 10 and 12%), while in Hungary, Poland and Slovakia, Erste expects a 2pp to 3pp increases of average unemployment rates to around 7 % in Hungary, 7.5% in Poland and 9.5% in Slovakia.
According to the report, countries in the region "with high employment in accommodation" and tourism "or food services are likely to see faster or higher increases in the unemployment rate." The possibility of teleworking should on the opposite reduce the negative impact of coronavirus on employment, in particular in countries like Austria. (ANSA).
