Analysts: July Unemployment Reduced by Hunger for New Employees

Analysts on July unemployment figures (photo by TASR)

Bratislava, August 21 (TASR) – Demand for new employees and the impact of tougher legislation are the main reasons behind the drop in unemployment in Slovakia in July, analysts told TASR on Monday in reaction to unemployment figures released by the Labour, Social Affairs and the Family Centre (UPSVaR) on Friday (August 18).

The latest statistics by UPSVaR show that the unemployment rate went down to 6.7 percent in July. The decline was significant, albeit not as big as the one reported in June. According to Slovak central bank (NBS) analysts, the number of people employed on the labour market grew in June and the number of people removed from labour office registers for other reasons was higher as well. The figures from June were “normalised” in July, however. “We can guess that tougher legislation regarding the possibility to make some extra money while being registered with a labour office at the same time has partly affected this swing,” stated NBS analysts, adding that although register removal rates for administrative reasons still exceeded average values in July, the gap narrowed when compared to June.

Nevertheless, the number of people finding jobs is still higher than those newly signing on at labour offices. “This indicates that demand for new employees continues to motivate employers to hire people from among the unemployed, which is a significant factor in falling unemployment,” said the NBS analysts. The statistics thus indicate dynamic employment developments in 3Q17.

UniCredit Bank Czech Republic and Slovakia analyst Lubomir Korsnak also expects a drop in unemployment and the creation of new jobs. “The growing economy should be able to generate new jobs in the next few months as well, pressing unemployment down to new all-time lows,” said Korsnak. He stressed that a more significant unemployment drop in all Slovak regions, chiefly in western Slovakia, hasn’t been hampered by a lack of new jobs, but by the number of unsuitable job applicants.