Local labor markets ready to recruit after Tungsram layoffs

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Employers in Kisvárda or the surrounding area could employ "more than half" of the workers Hungarian lighting maker Tungsram will lay off at its plant in the city, in the underdeveloped northeast of the country, the head of unions association Liga told news agency MTI on Tuesday.

Tungsram will "practically shut down" production at the plant, Melinda Mészáros told MTI. She said the plant in Kisvárda and another in Hajdúböszörmény, also in the northeast, would be the first Tungsram facilities to be affected by the mass layoffs, expected to start early in July. There is also demand for the laid-off workers on the local labor market in Hajdúböszörmény, she added.

Tungsram announced on April 27 that it would cease production of conventional lighting and lay off 1,600 workers by year-end. Around two weeks later, the company filed for bankruptcy protection.

Mészáros said layoffs would follow at Tungsram plants in Nagykanizsa and Zalaegerszeg, in the west of the country, then in Budapest in the fall. The highest number of layoffs will be at Tungsram's halogen lighting plant in Nagykanizsa, she added.

When Tungsram announced it filed for bankruptcy protection, chairman-CEO Jörg Bauer said management would do everything in its power to ensure the company's continued operation "based on a transition to a profitable business structure". He reiterated goals to make Tungsram a "smaller, more flexible, more competitive company, focusing on its innovative businesses".

In an interview with regional daily Zalai Hírlap early in April, Bauer said Tungsram, which made losses in 2020 and 2021, faces "serious challenges", pointing to the pandemic's impact on business, global supply chain interruptions, and the war in Ukraine.

Tungsram, which was bought out from GE in 2018, is still in the "early phases" of its independent existence, focusing on the transformation of its old businesses and the expansion of new activities, he told the paper. "That work can't be completed if we continuously have to struggle to survive," he added.

Tungsram Operations Kft had a loss of HUF 8 bln on net sales revenue of HUF 72.4 bln in 2020, the latest available public records show. Exports accounted for HUF 66 bln of turnover.

The company's average headcount was 3,266 for the year.

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