Czech Unemployment Increased by 3.3% (Still the Lowest in Past 22 years)

The unemployment rate in the Czech Republic swelled to 3.3% in January from 3.1% in December, due to typical seasonality during winter months, according to the Czech Labour Office data released on February 8. “The situation on the labour market has been usual in the past month. Compared to previous years, however, it is more favourable,” the Office said.

According to Labour Office General Manager Katerina Sadilkova, a decline in seasonal work has been recorded especially in construction and agriculture.

The number of the unemployed amounted to 13,523, a decline compared to December’s figure 44,171. There were 245,057 jobless people, the lowest January value since 1997. The number of vacant jobs increased by 7,043 month-on-month to 331,453 and by more than 200,000 vacancies y/y (100.725 vacancies in January 2018).

“The average share of unemployed people reached 3.2% last year, ie, one percentage point less than in 2017. At the moment, however, it is already at such low levels that room for a further decline this year is already relatively small,” according to ING Chief Economist Jakub Seidler.

Akcenta Analyst Miroslav Novak expects the same: “Since this year, no more significant decline in the unemployment rate is expected, and the total share of unemployed this will be roughly at 3%. Gradually, job vacancy growth will stop,” adding that a slight increase in unemployment at the beginning of the calendar year is a regular seasonal phenomenon and certainly cannot draw any negative conclusions.

“In the new forecast, the Czech National Bank is expected to fall to 2.9%, the Finance Ministry to 2.8%, as it predicts that solid wage growth can motivate some people to move from a grey economy to a full-time job. Still, the unemployment rate in the ILO definition will remain the lowest among the EU countries even this year,” Seidler added.

Author: red

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