After steadily dropping for five straight months, the unemployment rate
rose slightly in July to 3.1 per cent. However, seasonal factors are behind
the increase, including the entry of new high school graduates on the
According to the Labour Office, the number of unemployed is in fact at its lowest level since 1997 for the month of July.
The number of vacancies now stands at nearly 310,000 and only three regions have more jobseekers than openings: the Ústecký region in northwestern Bohemia and the Moravian-Silesian and South Moravian regions in the east of the country.
People in the Czech Republic worked an average of 41.1 hours per week last
year, according to a study by Raiffeisenbank, with entrepreneurs clocking
in about five hours more per week than employees.
In 2003, the average Czech worked a 42-hour week. Raiffeisenbank said the reduction stems from a campaign by trade unions launched last spring to reduce the standard hours to 37.5 per week.
Raiffeisenbank said any official reduction in the workweek would hurt the Czech economy rather than further reduce unemployment.
The government in January agreed to double the number of Ukrainians it would allow in as fast-track migrant workers to nearly 20,000 per year, in a bid to help address the chronic labour shortage, which has companies in the export-driven economy struggling to fill orders. According to Czech Chamber of Commerce, the fast-track scheme is a drop in the proverbial bucket – but still paying dividends.
Jana Maláčová (Social Democrats), due to be appointed Labour and Social
Affairs Minister on Monday, has said she will propose that the parental
leave benefit be increased by 40,000 crowns by the end of 2019 to reach
The parental leave benefit is paid monthly for a period of up to four years. Parents can opt to draw down more money over a shorter period, with the monthly allowance currently capped at 32,640 crowns.
At 2.9 percent, the Czech unemployment rate is the lowest in 22 years, and in particular graduates have never had it easier finding work. According to labour office statistics there are currently ten vacancies per graduate, a state of affairs that is attracting young people from Greece, Italy or Spain to the Czech Republic.
President Miloš Zeman agrees with Prime Minister Andrej Babiš and Finance
Minister Alena Schillerová that a 10-percent pay rise in the state
administration next year – which is being proposed by trade unions –
would be wrong. The latter quoted Mr. Zeman after the two ANO politicians
met the head of state and his team of experts at his Lány retreat near
Prague on Saturday.
The government is planning a 15 percent salary increase for teachers in 2019 and 6 percent raise for other state employees, such as fire and police officers and clerks. However, union leaders want such employees to get 10 percent more.
Ms. Schillerová said she, Mr. Babiš and Mr. Zeman believed that there should be a debate on pay rises. However, a 10 percent rise would cost the state an extra CZK 5 billion and would not be appropriate, she told reporters.
Minutes from the Czech National Bank board meeting of June 27 – when
policymakers raised the main interest rate by a quarter point to 1 per cent
– show growing concern over inflationary pressures stemming from the
tightening labour market and corresponding high wage growth.
The jobless rate dropped to 2.9 per cent in June, the lowest in the EU. In the first quarter of 2018, Czech average wages rose by 8.6 per cent, also outpacing the EU average.
The Czech annual inflation rate rose to an eight-month high of 2.6 per cent in June from 2.2 per cent in May, widening the gap between the rate and the central bank’s 2 per cent target.
Rising foreign producer prices, including commodities, pose an inflationary risk in the short term while global uncertainty associated with the impact of Brexit could have an anti-inflationary effect in the longer run, the CNB said.
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