December unemployment rise just temporary, say economists

Photo: UNDP in Europe and Central Asia via / CC BY-NC-SA

Compared to the previous month, unemployment in December rose by three tenths to 3.1 percent, with 231,500 people being out of work, the Czech Labour Office announced on Wednesday. However, unemployment numbers remained the lowest for any December since 1996 and the amount of job offers actually saw an increase.

Photo: UNDP in Europe and Central Asia via / CC BY-NC-SA
The Czech Republic has enjoyed steady economic growth since 2015 and the country’s unemployment numbers were the lowest EU-wide in November, according to Eurostat’s statistics.

However, numbers now released by the Czech Labour Office show that the number of people without work rose from 2.8 percent in November to 3.1 percent in December 2018.

Prague replaced Pardubice as the region with the lowest unemployment levels at 1.9 percent, while the highest number, 4.7 percent, was registered in the Moravian-Silesian Region.

Labour Office director Kateřina Sadílková told the Czech News Agency that a rise in unemployment levels is to be expected in the last months of a year, as events such as seasonal workers in construction and agriculture seeing their contracts run out factor in.

While the number of vacanies rose by about a thousand to 324,400 compared to November, the year-on-year increase was much greater, growing by over 100,000 positions. Increases are also seen in jobs for those who normally find it difficult to find employment, including those over the age of 50 and the disabled.

Economists told the Czech News Agency that the rise in unemployment is just a seasonal phenomenon and that a decrease can be expected within the next few months.

Delloite analyst David Marek said that the slowdown in economic growth indicated that unemployment levels would more or less stagnate towards the end of the year and that this phenomenon can be expected to continue until April when the number of people without work will start going down again.

Marek’s counterpart at Raiffeisen Bank, František Táborský, believes that unemployment in 2019 will remain low. He expects the average to lie at 3.3 percent, compared to last year’s 3.2 percent.