Based on the calm looks on people's faces, the carefree attitude of the local children and the bustling town streets, it's difficult to believe the town of Kysucké Nové Mesto in north-west Slovakia is in the midst of a crisis.
But according to recent figures, joblessness in regions like Kysuce has indeed reached the crisis point. The National Labour Office announced in late January that the country-wide unemployment rate surged to a staggering 20.1% at the end of 1999 - the highest in the country's history and presently the highest rate in all of Europe. Small towns and villages have been hit the hardest, with some areas burdened by rates as high as 35%.
Still, the people of Kysucké Nové Mesto, where the latest figures put unemployment at 25%, are managing to get by. The town government has no illusions about the current bleak situation and hopes that state action be taken soon. But it realises that the town's saving grace lies more in the assurance of foreign investment than in any government programme.
Tucked away within the surrounding hills of the Malá Fatra mountains, Kysucké Nové Mesto boasts a young population with a median age of 34. A walk through the snow-covered streets on a Sunday afternoon revealed general content among the townsfolk, contrary to the dismal numbers that describe their plight. The pleasant atmosphere could be seen in families out enjoying each other's company, children playing in the snow and friends gathering in local pubs.
Vladmír Čadlík, a 20 year-old labourer with electronics and hardware seller Elektrocentrum, said he was a former employee of the local hall of records and had had no problem finding his current job three months ago. Trade at the shop didn't really suggest a bad situation either, he said, as he was normally kept quite busy.
"I think business is going well, we have a steady stream of customers throughout the day. I really haven't seen the effects of the unemployment here," he said, adding that his friends haven't had much troubles finding work in the area either.
A young couple that chose not to divulge their names said many people work elsewhere to make ends meet. The man, 25, said he worked as an engineer in town and was worried about the stability of his employment, especially since his wife, 23, was three months pregnant.
"People here do have problems finding work, and many commute to Žilina, Bratislava or to the Czech Republic where there are more jobs. I'm doing OK now, but nobody knows about the future. The factories could very easily shut down," he said.
The head of the Kysucké Nové Mesto Labour Office, Jaroslav Králik, explained that by no means was the situation good, but that people may not be as bad off as the numbers indicated. The differential between the 25% rate and what actual unemployment may be, he said, could be attributed to the 'grey economy' (see story, above).
"The figures are not very accurate in this region because people are claiming unemployment benefits but have seasonal jobs at the same time. In the region, there are also people who are not registered at the labour office at all and still have jobs, so they do not turn up in the figures. It is difficult to tell what the true unemployment rate may actually be," Králik said.
But even with skewed numbers, unemployment undoubtedly remains a problem and Králik expected the regional rate to rise to 26% for February. The solution, he said, lay in restructuring the national economy and building up the region's infrastructure to put people to work.
"If the state government doesn't do something about unemployment and creating jobs this spring, then the situation might become really bad and people will have a very difficult time surviving," he said.
Private sector to the rescue
Government projections and plans aside, relief for Kysucké Nové Mesto will most likely come from the private sector.
In June 1999, the German company INA established a co-operative effort with the faltering KLF-ZVL roller bearing factory, the town's main employer which had a after-tax loss in 1997 of 176 million Slovak crowns ($4.1 million). The German firm, which also produces linear systems and engine components and is a leading manufacturer of roller bearings, has thus far put approximately 250 people to work and projects this number will increase soon.
INA began building its own manufacturing plant in August with a completion date set for April. The new facility will mark the first of a three-stage production plan, and by the end of May, when the new plant begins operations, INA's number of employees is expected to jump to 500. Ultimately, in a projected five years once all three stages of development are completed, the company is expected to employ more than 1,000 people, which would cut the number of unemployed in the region by about 25%.
Anton Ježík, president of INA Kysuce, said operations thus far had been going according to plan, and was optimistic about the company's future in town.
"Because unemployment is high here, the new factories will have a very positive effect. It's a good oportunity for young people, and we will provide training for those in local schools," Ježík said. "I'm pleased that the factory is here, and so is the state and the town. This is the biggest project of this type in the region."
Kysucké Nové Mesto Mayor Peter Dubravay said that historically, the region had never been a hotbed for jobs, even during the more stable days of communism. However, he remained positive about the future thanks to INA's investment.
"The regional soil is not ideal for agriculture, industry has never quite taken off and the area was overshadowed by more popular destinations in the Tatra Mountains for tourists," he said. "But I'm optimistic about the future. It think it will get better with INA here. We have a good work-base here and I think INA's presence will lead to more foreign investment in this region."
by Barbora Tvarošková
7. Feb 2000 at 0:00 | Keith Miller