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Special Focus: Hungarian Industry

The impact of Hungarian Labour Force in the National Industry

"In addition to shaping the proper legal framework the Hungarian government applies an active development policy so as to stimulate the creation of new jobs. Development programmes of national and EU funding are formulated in order to expand infrastructures, corporate innovation and the promotion of supplier network-creation, focus at increasing the competitiveness of national small and medium-sized enterprises and at the attraction of foreign direct investment."

The Hungarian government has as a fundamental objective the creation of a sustainable economy that will grow faster than the EU average and after the accomplishment of it to expand even more dynamically. The Hungarian authorities realise that in order to achieve the aforementioned objective the expansion of employment is an indispensible condition. Therefore, the creation of an adequate macroeconomic framework that will channel the inactive Hungarian workforce back to labour market by job creation, labour incentive and qualification is of high priority.

As it is already mentioned, Hungarian authorities are constantly trying to shape a proper and adequate framework that will promote the further development of labour. Under this context the Hungarian government created the labour code that regulates legally the labour relations within the country. The Labour Code (Act XXII of 1992) is broadly similar to employment law in other European Union countries. It provides a basis for organized labour negotiations with trade unions or other representatives of employees (e.g., works councils). Additionally, it highlights that the terms of employment are established by a written labour contract, and may be terminated by mutual consent of the parties.

In addition to shaping the proper legal framework the Hungarian government applies an active development policy so as to stimulate the creation of new jobs. Development programmes of national and EU funding are formulated in order to expand infrastructures, corporate innovation and the promotion of supplier network-creation, focus at increasing the competitiveness of national small and medium-sized enterprises and at the attraction of foreign direct investment. This milieu is expected that will stimulate the creation of new jobs.

The objective of render labour the main driving force of economic growth and put in the centre of the economic development strategy is being reinforced by the quality of Hungarian labour force, which is estimated at about 4.2 million and is highly educated and skilled. Hungary has a great tradition of providing a labour force of high standard in domains of industry with added value such as engineering, medicine, economics, and sciences. Furthermore, about two- thirds of population has completed secondary technical or vocational education a fact that de facto creates a comparatively advantage for the Hungarian labour.

A negative aspect of labour is created by the fact that the country has comparatively high levels of institutional, economical and political disparities something that also applies to employment, which varies regionally. In the North-West temporary shortages of skilled workers occur, particularly in the financial and marketing sectors. Additionally, in the regions east of the Danube unemployment levels are usually higher than the national average and sometimes exceed 15-20%.

The Hungarian policy of promoting employment was implemented without serious difficulties until the recent economic recession that hit the country hard and did not leave the labour market unattached. In the 2nd Quarter of 2009, the number of employed people was 3,797.1 thousand, 71.4 thousand less than in the corresponding quarter one year earlier. The domain of the industry that was hit harder by the crisis is manufacturing where 58 thousand fewer people worked in the 2nd Quarter of 2009 than in the corresponding period a year earlier.

Labour force is a significant aspect of the Hungarian economy. In a country with a tradition of a labour force of quality the authorities of it are trying to delineate a framework for improving the quality of the labour force and the impact of it in the national industry. The international economic recession has seriously deteriorated the effort of the country, though the positive developments of the past reinforce the opinion that this will be just a negative parenthesis.




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