More Redundancies Likely in Hungary

In the last quarter of this year, 26% of companies operating in Hungary plan to lay off workers, the employment agency ManpowerGroup said on Tuesday, the state news agency MTI reports.

According to a survey by the recruitment agency, half of domestic companies are not planning any changes, but only a fifth of them plan to hire staff by the end of the year, so the scale of downsizing may be higher than staff expansion. This has not happened since the epidemic.

Redundancies are expected mainly in the capital and in the Western Transdanubian region. Indicators suggest that only manufacturing is likely to expand, while the balance of staff in banks, credit institutions, insurance and real estate is expected to stagnate, and the workforce in basic materials, IT, technology, telecoms, communications and media is likely to shrink significantly. The outlook for the tourism sector is also negative, with 39% of hotels and restaurants planning to cut staff. What is expected will also depend on the size of firms, with smaller firms less likely to lay off employees this year, the agency wrote.

Based on the data, ManpowerGroup believes that the labor market has entered a new phase, with job seekers facing tougher times as labor shortages ease. The change has been explained by a surge in raw material and energy prices and an expected fall in solvent demand, which is forcing employers to adapt quickly.

ManpowerGroup's forecast is based on feedback from a representative sample of 500 employers. The quarterly survey covered 41 countries, the statement said.