Though the share of unemployed increased to 5.3%, the growth is solely due to seasonality. Economic dynamics accelerated at the turn of the year, translating into a growing number of open vacancies, as well. However, it’s now difficult to fill positions. The unemployment rate is already so low that it has little room for further declines. Thus, there are emerging strong wage growth pressures on the labour market.
The share of unemployed increased in January to 5.3%, and it increased only a tick compared with the December figure. At the beginning of the year, a big part of fixed-term contracts expired, and the winter months do not offer as much seasonal work. Thus, unemployment reaches its local highs. The increase does not reflect the slowdown in the economy but rather they mirror the seasonal effect on the number of unemployed. After the calendar effect adjustment, the share of unemployed dropped to 4.9%, according to our calculations. This is the lowest figure since January 2009. Even the number of open vacancies showed a slight decrease. The ratio of job seekers to vacancies after adjusting for seasonality declined to 2.4. This is the lowest value since September 2008.
Economic activity gained momentum at the turn of year, which translates into demand for a labour force. On the other side of the labour market equation lies the weak supply of labour. Especially in some industrial sectors, it very difficult to find a skilled labour force. The situation is not set to change this year. However, the share of unemployed will not decrease as rapidly as last year, as it has little room for steep declines. Our forecasts show that this year’s bottom will print in October at 4.5%. The lack of an available labour force together with sound economic growth will press on wage growth. Nominal wage is set to increase 4.6% this year. The situation of households will thus remain favourable.