The Hungarian retail sector grew significantly in 2014 and the sector’s performance has been steady over the past years, so economic conditions in Hungary do not justify Tesco’s decision to lay off employees.

In Hungary, the retail sector is suffering from labour force shortage and this may make it easier for employees who lose their job to find a new one. According to the National Employment Service, in Hungary there are 2300 job vacancies in the sector, Minister for National Economy Mihály Varga said at a press conference.

Tesco has been facing challenges Europe-wide, not only in Hungary, therefore it is nonsensical to claim that Government measures are forcing the company to close stores and downsize. In the opinion of Mihály Varga, it is fishy to pretend to seek those responsible for the situation outside the company management.  Head of Hungary’s Trade Union of Retail Employees József Sáling has earlier stressed in an interview that “labour shortage is grave in the retail sector.”

Fluctuation is high in the sector, it may be as much as 30-40 percent and there are very many vacancies. In light of data by the Hungarian Central Statistical Office (KSH), the number of unfilled retail jobs has been on the rise: while in 2010 the number of unfilled retail jobs averaged 1485, it was 2307 in Q1-Q3 2014.

Lay-offs affect hardly 3 percent of Tesco employees and downsizing will result from the closing of smaller units at settlements with more than one Tesco facility. This may make it easier for those affected to find a new job possibly at the same location.

Higher household consumption is expected to be the key driving force behind the 2.5 percent GDP growth projected for 2015 in Hungary which signals dynamic growth in retail sales.  As a result of that, hiring in the retail sector may also accelerate.

(Ministry for National Economy)