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Rise in employment positive, but no turnaround likely, say analysts

Analysts interviewed by MTI said they consider the increase in labor market activity positive, but they do not expect to see a turnaround in unemployment in the remaining part of the year or in 2012.

Fresh figures published by the Central Statistics Office (KSH) Friday show unemployment in Hungary was 10.7% in the 15-74 age group in July-September, down slightly from June-August. In the 15-64 age group, the jobless rate was unchanged from the previous at 10.8 percent.

The number of the employed rose by 33,000 to 3,856,000 in the period, and the number of the economically inactive fell by 19,000 to 2.49m.

György Barta of CIB Bank told MTI that he considered the increase in the number of economically active as a positive development, but said it would be too early to talk about a turnaround in unemployment. Barta put annual unemployment at 10.8% this year and at 10.5% for 2012. He said the improvement next year could primarily come from the "rather costly" public work schemes.

András Oszlay of Takarékbank predicted 11% unemployment for this year as a whole and 10.7% for 2012.