The crisis, growing unemployment and a fall in job vacancies have forced Czechs to seriously rethink the conditions under which they are willing to take on a job. Almost 80% of job applicants are willing to do work involving fewer skills. More than 50% are willing to accept a lower wage and commute to work for one hour or more. This is the outcome of a March survey that the agency Grafton Recruitment carried out among 2,500 job applicants.
“Job content is now the most important factor, and financial remuneration only comes second,” Grafton manager Milan Novák commented on the research. Still a year ago, companies found it difficult to find both blue collar workers and specialists and hired thousands of foreigners. At present, Mongolians and Vietnamese are leaving the Czech Republic and people are competing for every vacant position.
The nationwide survey also revealed a willingness among nearly 100% applicants to change their profession and undergo retraining to get a job. “That basically corresponds to what all leading employment agencies in our association are currently experiencing,” said Luboš Rejchrt, head of the Association of Personnel Services Providers.
Companies dictate conditions
Until recently, employers were captured by the dictate of job applicants and companies had to cope with an enormous shortage of staff, Rejchrt said. Now there are nearly 449,000 people registered at employment offices, almost 113,000 more than a year ago.
By contrast, the number of vacancies has dropped by nearly 96,000 over the past twelve months to the current 55,400. Who wants to get a job now has to offer more. It’s not job seekers, but employers who dictates conditions now.
Flexible managers
“We have recorded these trends roughly since the beginning of the year. A willingness to work for a lower wage and to travel to work longer is apparent mainly with secondary school graduates and middle and higher management,” said Gabriela Rathouzská of the employment agency Trenkwalder. For example, the car maker Hyundai had two candidates for a position last year. Now that it is relaunching production after the crisis at the start of the year, it can choose from among 15-20 applicants.
Employment offices confirm the trend, even though the situation is different in individual regions. “Job seekers have really reduced their requirements in the course of the last few months. A willingness to commute to more distant localities is apparent rather with positions involving more skills,” said Magdalena Čadová, head of the labour market department at the employment office in Plzeň.
Employers now see crowds of people applying for positions that they are not trained for. Assembly plants all over the Czech Republic are laying off thousands of people for whom there is no other work.
“Last year, finding staff for all vacant posts was a problem. Now I have a stack of CVs here, especially from people from closed-down factories. But I need a trained shop assistant, who would preferably be experienced in selling electrical appliances. And there are few such people,” said Libor Krasanovský, the owner of Tachov-based company Elektromedia.
Jiří Belinger, the owner of garden machinery producer Vari and deputy board chairman of the Association of Small and Medium-Sized Enterprises and Crafts CZ, said that unemployment rate favourable for employers is between 8% and 10%. “Five percent of people in Europe who are able to work will never want to work. There are 3% of those who lost their job and want to continue to work. Even for less money, further away from their home etc. That means that a sort of a healthy competitiveness on the labour market starts at 8%. So the over-employment problem is finally coming to an end,” Belinger said.
Businesses themselves are not united on what rate of unemployment is beneficial and what rate is begins to pose a problem. President of the Confederation of Industry of the Czech Republic, Jaroslav Míl, said that the current unemployment rate of 7.7% already means a social problem. “Although it is true that having a certain surplus in the supply of labour is advantageous,” he added.
On the other hand, Belinger said that serious social problems connected with pressure on higher government spending and rising crime rate and extremism only occur when unemployment exceeds 10%. However, the Czech Republic, a country with one of the lowest unemployment rates in Europe, may see a two-digit rate of unemployment quite soon.
The reason is that the Czech gross domestic product can drop by as much as 3.5% this year, according to latest forecasts by the International Monetary Fund and by some Czech analysts. “If it did happen, analysts would have to again reconsider their predictions for unemployment and for the balance of the public budgets. The unemployment rate would probably reach two-digit levels,” UniCredit Bank analyst Pavel Sobíšek said.
