Development of the economic activity of the population - 2. quarter of 2004

Employment dropped in ten regions of the Czech Republic, in absolute terms most in the Královéhradecký and Olomoucký Regions. On the other hand, the number of workers considerably increased in the Ústecký Region that chronically suffers from high unemployment.

Compared to Q2 2003 average, employees decreased in number by 10.6 thousand, but they still remain the most numerous group of persons in employment (3 881.7 thousand, 82.6 % of first job holders). This confirms the long-term downward trend: since 1995 their number had dropped by over 390 thousand persons. The number of members of producers’ cooperatives already dropped below the level of 26 thousand (to 25.7 thousand, by 3.1 thousand down on the level a year ago) and was over 70 % down on the year 1995.

The drop in total employment was also influenced by a relatively high decrease in the number of own-account workers (the self-employed without employees). Subsequent to the incessant growth for a number of years their number dropped by 12.3 thousand year-on-year and was 570 thousand (573.6 thousand in Q2 2004 to be more specific). Despite this drop, their number increased by almost 200 thousand compared to 1995 average. The number of the self-employed with employees (employers) dropped by 10.0 thousand year-on-year to 188.2 thousand; in the long run the growth of this category is markedly lower than that of own-account workers. Similarly, the number of family workers increased by 3.5 thousand year-on-year to 31.1 thousand.

Employment in the primary sector (agriculture, forestry, fishing) dropped below 210 thousand persons (208.2 thousand). The decrease in the number of persons employed in the secondary sector (by 36.1 thousand to 1 839.8 thousand compared to Q2 2003) primarily resulted from a 30.9 thousand decrease in the employment in manufacturing where manufacture of wearing apparel (-10.7 thousand), manufacture of machinery and equipment (-10.2 thousand) and manufacture of fabricated metal products except machinery and equipment (-8.4 thousand) decreased their employment most. On the other hand, employment went up in manufacture of motor vehicles (+15.1 thousand), manufacture of chemicals and chemical products (+6.3 thousand) and manufacture of furniture (+4.2 thousand). The higher increase in the employment in mining and quarrying is attributed to the increase in the number of workers engaged in mining and agglomeration of hard coal (+7.5 thousand).

Employment in the sector of services remained unchanged in total, but the individual branches of the sector developed differently: the employment grew most in hotels and restaurants (+7.8 thousand in restaurants, +3.6 thousand in hotels and similar accommodation establishments), health and social care (+ 7.4 thousand in social care) and transport (+6.9 thousand in land transport except for transport via railways).

On the other hand, employment dropped most year-on-year in public administration and defence and compulsory social security in total, -13.1 thousand (primarily in provision of services to the community as a whole: -19.4 thousand). Employment in education also decreased considerably (-10.9 thousand), of which the number of persons working in pre-school facilities and basic education decreased by 4.5 thousand and in secondary education by 8.2 thousand. The number of persons employed at universities increased slightly, by 1.1 thousand.

The business sector decreased its employment in most of the regions of the Czech Republic. The highest decreases in the number of the self-employed both with and without employees were found for the Pardubický (-9.5 thousand), Ústecký (-8.4 thousand) and Moravskoslezský (-4.6 thousand) Regions. With the 4.5 thousand decrease in the number of the self-employed residing in Prague, there was an increase of 6.1 thousand recorded for the number of these persons in the Středočeský Region. The absolutely highest increase in the number of the self-employed was recorded for the Zlínský Region (+6.8 thousand).

With the decreasing total employment of the residing population, the number of unemployed and economically inactive persons increased year-on-year. The number of the unemployed pursuant to ILO methodology was 419.1 thousand (Q2 2004 average), rising by 34.4 thousand year-on-year (the figures of the employment offices indicate that the number of registered job applicants increased by 24.5 thousand over the same period). The number of unemployed women dropped by 0.2 thousand year-on-year to reach 218.9 thousand. A high increase in the number of the unemployed was recorded for the 20-29 age group (+14.3 thousand). The situation of men and women aged 50-59 is problematic: the number of the unemployed coming under this group increased by 10.8 thousand on Q2 2003.

Characteristic of the development of unemployment is the fast growth of the number of persons unemployed for a long time (one year or more): their share in the increase in the number of all unemployed persons was almost three quarters. Alarming in particular is the increase in the number of long-time unemployed persons aged 20 to 29 (especially of those with work experience or who had been preparing for their occupation or had been on military service) and 50 to 59.

The number of the unemployed with basic education increased by 16.3% year-on-year to 105.1 thousand and of those with secondary education without GCSE by 12.7% to 207.4 thousand. On the other hand, the number of the unemployed with secondary education with GCSE dropped to 92.7 thousand (-3.4 %) and the number of unemployed university graduates virtually remained unchanged (only 14.0 thousand in total).

The rise in unemployment was considerable especially in the Olomoucký and Karlovarský Regions, but the unemployed increased in number in most of the other administrative regions of the CR, too.

Development of unemployment is sizeably influenced by seasonal effects. Compared to Q1 2004 the number of the unemployed dropped in Q2 2004 by 24.7 thousand persons, the number of job applicants registered by the employment offices decreasing by 32.4 thousand.

The decrease in total employment and the increase in the number of the unemployed showed themselves in a relatively high increase in the general unemployment rate: it rose by 0.7 percentage points to 8.2% year-on-year. This increase was only observed in the male part of the population (+1.2 percentage points to 7%), while in the female population the general unemployment rate remained at 9.7%. Over the same period the rate of registered unemployment, as established by the Ministry of Labour and Social Affairs of the CR, rose by 0.5 percentage points to 10.1%. The similar development trend of the two rates is also confirmed by the fact that year-on-year seasonal drops stood at 0.5 percentage points for the general unemployment rate and 0.6 percentage points for the unemployment rate based on the numbers of job applicants registered by the employment offices.

Given for information below is the estimate of the monthly rate of unemployment made by Eurostat for the last known month (May 2004). As in 2003 the rate of unemployment in the Czech Republic is below the average for all 25 EU Member States and is lower than the rates in 13 EU Member States.

The number of economically inactive persons aged 15+ (according to LFSS methodology they are persons who had no job and were not seeking job during last four weeks or failed to meet conditions for being classified among unemployed persons) increased by 48.0 thousand year-on-year and stood at 3 547.7 thousand in Q2 2004. The number in this category is primarily affected by the number of pensioners and of persons preparing for their future occupations. The number of basic school pupils rose (+0.3 thousand). While the number of apprentices dropped (-5.7 thousand), the number of secondary school pupils increased by 14.1 thousand to 376.3 thousand and that of higher professional school pupils or university students rose by 19.7 thousand to be 227.2 thousand. The number of economically inactive retired persons who did not actively seek job rose by 23.1 thousand to 1 819.3 thousand and the number of early-retired persons fell by 3.6 thousand to 74.9 thousand. Furthermore, the number of disability pensioners increased by 10.6 thousand to 302.8 thousand. These figures cannot accurately correspond to the statistics on pupils and students of the Ministry of Education, Youth and Sports of the CR or to the numbers of pensioners in the records of the Ministry of Labour and Social Affairs of the CR, because the pupils, students or pensioners who qualified for being classified to persons in employment or unemployment in the reference week are not reported as economically inactive. In the other groups of economically inactive persons a rather marked increase was observed for the number of persons who cared for family or were housepersons (+1.8 thousand to 324.9 thousand); they were mostly women.

The decrease in the number of the employed and the rising number of the unemployed and the economically inactive produced a drop in the rate of employment (the ratio of the number of first job holders to the number of residents aged 15+) from 55.0 % in Q2 2003 to 54.2 % in Q2 2004. The employment rate had dropped considerably since 1995 (59.0%), in spite of the fact that numerous population cohorts from the mid-1970s entered the labour market. There were large regional differences in this rate, brought about by the number and structure of vacancies in the regions in particular. While there were almost 60 % (59.0 %) of all residents of working and post-working age economically active in Prague, the employment rate in the Olomoucký Region was only 51.2 % and in the Moravskoslezský Region, not even a half of persons aged 15+ were working (49.0%). The employment rate in the other regions ranged between 52.6% (the Ústecký Region) and 57.3% (the Liberecký Region).