The registered unemployment rate climbed to 3.1% in December, according to figures of the labour ministry. The print was exactly in line with expectations, and it rose by 0.3pps m/m but fell by 0.7pps y/y.
For the first time since the end of 2016, the labour market didn’t show further signs of overheating, though it remains extremely tight and labour shortages are still acute. Nevertheless, the ratio of job seekers to available vacancies rose slightly, from 0.66 in November to 0.71 in December, which was a first over the past two years.
The discrepancy remains considerable, however, and the odds are that there will be a lot of time before the labour market is no longer so tight. The number of registered job seekers continued to fall by double digits, down by 17.5% y/y in December, even if it was almost a two-year low. The number of available vacancies increased by 49.8% y/y, falling for the first time under 50% y/y in 15 months.
However, flows paint a more different picture, namely that the labour market remains very tight. Newly registered job seekers fell by 7.1% y/y in December, reversing from a 0.9% y/y increase in November. The reason why total job seekers fell is that people taken off the registry fell by 15.2% y/y in December, mostly due to administrative reasons, which distorted the overall number of job seekers. The same applies to available vacancies, as there were much more positions that were eliminated in December than in November, which led to an overall decline in offered positions. However, newly created vacancies rose by 42.1% y/y in December, up from 38.8% y/y in November.