At 5.6 percent, the Czech Republic boasts the third lowest unemployment rate in the EU, ranking behind Germany and Austria, according to the Czech Statistical Office (ČSÚ). That’s the lowest the figure has been since 2009. Deloitte’s chief economist, David Marek, predicts it will drop to 5 percent before the end of the year, writes Hospodářské noviny. The data, however, was based on Eurostat methodology. Under its own system, the Czech Labor Office registered an unemployment rate of 7.5 percent in February. In 2008, unemployment dropped to 4.3 percent, but Marek says that the economy was overheated and that a healthy rate is around 5 percent.
The Czech labor market started recovering eight months ago, with joblessness falling by 1 percentage point monthly compared to a year ago. The labor pool is drying out in some sectors, with manufacturers pointing to a lack of technical workers. The low unemployment rate will not push wages up, however, thanks to low inflation, writes the daily. Prices grew by only 0.4 percent in 2014, and the central bank foresees deflation for 2015.
