ING Revises Romania 2010 Jobless Rate Fcast To 9.5% Tops Vs 10.1%

„We still expect the seasonally adjusted unemployment rate to inch higher in the months ahead, but it seems like the pace of increases could be a slow one. (…) We may see the unemployment rate hovering around 8.5% during the first half with another increase towards year-end on the back of seasonal factors (the 9% level could be surpassed, but 10% does not look likely anymore),” ING said in a report.

In January, Romania’s jobless rate rose to 8.1%, from 7.8% in December, according to the country’s employment agency data.

However, ING analysts said Romania’s labor market is still far from stable and that more jobs need to be created.

„Employment in the industrial sector is still on a downtrend, but we believe it will reverse pretty soon given that this sector is mainly export-oriented and external demand is getting better, that the sector already saw a period of more than nine months of recovery and that further growth is expected in 2010,” the report noted.

In February, the unemployment rate is expected to increase to 8.3%-8.5%, while the peak in unemployment may be registered in the second half of the year, the analysts said.

„Looking forward, some negative impact on registered unemployment rate may come from reform measures implemented in the public sector, but we doubt the number of people laid off will be around 100,000,” ING said.