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Unemployment rate in Hungary dropped slightly during the May to July period, while economists expected the rate to remain unchanged from the previous three-month period.
The jobless rate edged down to 11% in the May to July period from 11.1% in the previous three months, the Central Statistical Office said Friday. Economists expected the rate to stay at 11.1%. The jobless rate was 1.3 percentage points higher than the same period last year.
The rate had been falling since the quarter-ending April, when the jobless rate was 11.8%. The number of unemployed persons grew 15% year-on-year to 467,200 during the three-month period, which was fewer than the 473,300 in the previous three months. At the same time, the number of employed rose to 3.79 million from 3.78 million.
During the period, 16.4% of the unemployed population belonged to the 15 to 24 age-group. The unemployment rate for this group was 26.3%, up 0.8 percentage point from last year.
Meanwhile, the labor force participation rate slightly rose to 55.4% from 55.3% in the April to June period. Similarly, the employment rate increased slightly to 49.3% from 49.2%. The number of economically active persons increased to 4.26 million from 4.25 million in the previous period.
Though jobless rate has been showing a downward trend of late, the rate was considerably higher than last year, as reflected in the weak domestic demand and falling retail sales during the period. In June, retail sales continued to decline for the fourth month, dropping 0.1% month-on-month on a seasonally and calender-adjusted basis.
Earlier this week, the Hungarian central bank observed that the domestic demand remained notably weak and the unemployment rate is likely to remain elevated throughout this year. The bank expects household consumption to remain subdued this year, depressed, in part, by persistently high unemployment.
Data released earlier this month showed that the Hungarian economic recovery halted in the second quarter after recovering slightly in the first three months of the year, with the gross domestic product remaining unchanged in the June quarter from the previous three months. GDP grew 1% year-on-year in the second quarter, faster than the 0.1% growth in the previous quarter.
According to the central bank, although the recovery will remain fragile over the short run, GDP may increase at a tangible rate this year. The central bank maintained its growth outlook at 0.9% for this year, while slashed the forecast for 2011 to 2.8% from 3.2%. Growth is forecast to accelerate to 3.8% in 2012.
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