Trade and Hospitality Sectors See Biggest Drop In Employment Due To Pandemic

According to data from the Czech Statistical Office (ČSÚ), the decline in GDP and rise in unemployment in the first quarter of 2021 was mostly driven by the impact of pandemic restrictions on the trade, transport, accommodation, and food sectors. Photo Credit: TMA / BD.

Czech Rep., June 17 (BD) – According to data from the Czech Statistical Office (ČSÚ), the biggest impact of the pandemic restrictions in the first quarter of this year was felt in the trade, transport, accommodation, and food sectors, but there were also significant drops in activity in personal care services, and cultural, entertainment and recreation activities. On the other hand, the value-added in the information and communication sector increased year-on-year, and renewed growth in the manufacturing industry was largely supported by export-oriented sectors, especially motor vehicle production.

“The decline in the Czech economy was still due to a shortfall in household consumption, related to closed shops and limited services. Investment was also weak due to uncertainty in the economy. The first months of 2021 then brought a short-term cooling of exports. The result was a deterioration in the foreign trade balance compared to the record at the end of 2020,” said Marek Rojíček, Chairman of the Czech Statistical Office.

The manufacturing industry strongly contributed to the year-on-year decline in employment in the first quarter of 2021. However, the trade, transport, accommodation, and hospitality sectors were again the most affected. There was also a year-on-year decline in the number of self-employed people and small businesses. In the first quarter of 2021, the total number in this group decreased by more than 5%, the largest drop since 2013. The general unemployment rate reached 3.4% in April this year, the highest in four years.

This contrasted sharply with the continuing development in the information and communication sectors, in which companies were still seeking new staff, mainly for specialist positions. New positions with higher qualification requirements were also available in public services, especially education and health care.

On the other hand, last year’s significant increase in the number of economically inactive employees, i.e. people who are neither working or actively seeking employment, did not continue in the first quarter of 2021. However, there was still a limited availability of part-time jobs, affecting groups such as students and women on parental leave. In March 2021, the rate of unemployment was highest among under-25s, especially women and employees in the tourism sector.

“Unemployment among women has risen twice as much year-on-year than among men. Greater job losses in areas related to tourism and leisure activities, and a reduction in the supply of flexible working hours have also weakened the position of young people in the labor market,” added Rojíček.

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