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| Unemployment and education remain the focus |
| Bratislava, 27.02.2015 |
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| Though unemployment fell by more than 1 percentage point during 2014 and new jobs came from lower levels of growth, employers remain cautions, citing slower than originally expected economic recovery in Europe as well as the Russo-Ukrainian conflict as source of their concerns.
The average jobless rate calculated by the Central Office of Labour, Social Affairs and Family (ÚPSVaR) based on the unemployed who are ready to take a job, the so-called registered unemployment rate, amounted to 12.79 percent in 2014 and decreased by 1.32 percentage points compared to 2013. The average unemployment rate is nearly as low as it was in 2010, according to Labour Minister Ján Richter.
“Certainly various steps we offered within the projects to help young unemployed below 29 years of age, but also regional measures, helped to achieve this,” Richter told the press, as quoted by the TASR newswire.
Human resource professionals see different reasons behind the positive development. Luboš Sirota, general director at McROY Group, pointed to the relatively significant growth of employment which occurred in spite of the milder economic growth.
“This was because the market benefited from layoffs from previous periods,” Sirota told The Slovak Spectator. “Many companies, by optimising their personnel costs pre-stocked, by which they responded to the rise in income and payroll taxes as well as changes in the Labour Code. Because in 2014 it was not possible to increase labour productivity at such a pace as during the previous period, the growth of productivity brought with it automatically also the creation of new jobs.”
Despite the falling unemployment rate, it remains high compared to other EU countries. The seasonally adjusted jobless rate in the eurozone stood at 11.4 percent in December 2014, while the EU 28 average was even lower: 9.9 percent. Slovakia’s jobless rate was the sixth highest at the end of 2014, with only Greece, Spain, Cyprus, Portugal and Croatia reporting higher rates.
Martin Krekáč, chairman and owner of Jenewein Group and senior partner of Amrop, when commenting on the most significant trends on the labour market in 2014 cited continued stagnation.
“Proposed policies do not include needed systemic measures, which would make the labour market more dynamic,” Krekáč told The Slovak Spectator. “This factor along with the continuing uncertainty and unpredictability on the global market are causing employers to behave overcautiously.”
Economists see several reasons behind the consistently high unemployment in Slovakia. They include the structure of Slovakia’s economy, labour optimisation, high payroll taxes and the low level of education and discrimination excluding the Roma population from the labour market.
Andrej Arady, macro economist with VÚB bank, specified that the structure of Slovakia’s economy is dominated by industry. The economic growth between 2003 and 2013 was driven by sectors with a high growth of labour productivity and thus there was no need to create new working positions. Industrial production made up 39 percent of the economic growth between 2003 and 2013, but the number of work places fell by 9 percent.
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Address : Euro-Brew Ltd., Hlboká 22, 917 01 Trnava, Slovakia
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