Government considers solutions for labor shortage

Banking

If a shortage of trained workers were to endanger an important investment, the government would help to fill the gap with foreign workers after issuing the necessary licenses, Minister of Finance Mihály Varga told a business forum organized by AmCham Hungary on Friday.

The jobless rate has dropped significantly in the past few years to below 4% at present. However, there are about 70,000 vacancies and a shortage of skilled labor has developed in several sectors, Varga said, cited by national news agency MTI.

At the same time, wages have risen significantly and payroll taxes have been cut as a result of a 2016 agreement with employers and employees, while the number of Hungarians working abroad has dropped by 15,000, Varga noted.

Hungaryʼs recently updated Convergence Program projects GDP to grow by 4.3% this year, 4.1% in 2019, and 4.0% in 2020. Government targets for the coming years include cutting the state debt ratio and the rate of payroll taxes further, as well as reducing the tax burden on employers to the average level of the Visegrád Four countries.

The government expects foreign direct investment inflow to rise in the future, especially in the vehicle industry, food industry and pharmaceuticals manufacturing, Varga added.

MTI also cited Varga as saying that the government is not concerned about the recent weakening of the forint, and that "exporters are not weeping" as a consequence. The exchange rate is within the range considered market and equilibrium-based, and there are signs that the rate is stabilizing, he added.

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