Hungary labor market tightens further | ING Think
Latest labor market statistics from the Hungarian Central Statistical Office show that there hasn’t been any significant change in the overall situation for Hungary. The unemployment rate has held steady at 4.5% in October 2024 according to estimates, aligning closely with the official three-month moving average rate of 4.6%. This means that around 220,000 to 225,000 individuals are currently unemployed.
In October, there was a slight decrease in the number of employed individuals, but this was within the margin of error. Additionally, there was a minor decline in the number of inactive persons, which could be attributed to factors like population decline and retirement. All indicators, including the number of unemployed, employed, and those in employment, decreased compared to the previous month.
Looking at the three-month moving average, the decrease in employment numbers can be partly explained by a decrease in population and a shift back to inactivity. The slight fall in employment can be mainly attributed to the disappearance of seasonal work, and there are no signs of significant structural changes in the labor market. The tight labor market has a crucial impact on wage decisions, with some companies retaining staff beyond their planned capacity due to rising wages and recruitment costs.
While the current business outlook may not be very optimistic, some firms are holding on to their workforce, potentially creating a kind of ‘hidden’ unemployment. In the upcoming months, seasonal employment might see an increase during the winter season, which could help improve the unemployment rate. Sectors like construction and services are showing positive growth trends, contrasting with the industry, where layoffs might be a possibility due to a fall in orders. Overall, a minor improvement is expected in the labor market, with the unemployment rate possibly nearing 4.3% by the end of the year.
