BUSINESS IN SHORT

Crisis might cost 5,200 Slovak jobs

AS A CONSEQUENCE of the global financial crisis, an additional 5,200 Slovaks could lose their jobs, according to Labour Minister Viera Tomanová. She was speaking on October 30 after some members of the Slovak Cabinet met representatives of employers and trade unions, the ČTK newswire wrote.

AS A CONSEQUENCE of the global financial crisis, an additional 5,200 Slovaks could lose their jobs, according to Labour Minister Viera Tomanová. She was speaking on October 30 after some members of the Slovak Cabinet met representatives of employers and trade unions, the ČTK newswire wrote.

Participants in the meeting agreed that they wanted to maintain employment at any price. Prime Minister Robert Fico promised a helping hand to companies in order to prevent the need for lay-offs.
But some companies have already started shedding staff. For example, compressor-maker Embraco has announced it will make about 450 people redundant by the end of the year. Three auto-component producers in Vráble have also announced large lay-offs, making about 400 people jobless.

Companies have been affected not just by a drop in orders from abroad but also by a potential restriction in financing from their banks. Banks have already warned that loans will become more expensive and that new credit approval will become more conservative.

Fico promised employers that he would negotiate with representatives of the financial sector over creation of new products for small and medium-sized companies. He also admitted that the current 60-day term which the state currently has to return excess VAT to entrepreneurs could be halved. Fico added that the government might also consider favouring domestic suppliers in state tenders.
“The most important thing on which we want to focus is maintaining employment,” said Fico.

Economy Minister Ľubomír Jahnátek warned foreign investors who have obtained assistance from the Slovak Republic that they could face sanctions if they decide to lay off employees.

“I warn them to assess very sensitively whether they will oust people in Slovakia or in their other branches,” said the minister.

The Economy Ministry has formed a special committee intended to monitor the impact of the crisis on Slovakia and propose measures to tackle its unfavourable effects.

About 2.4 million people were recorded as working in the Slovak economy during the second quarter of 2008. There are currently about 20,000 job vacancies in Slovakia, according to ČTK. The unemployment rate in Slovakia, in spite of a decrease over the last few years, remains one of the highest in the European Union. According to the Centre for Labour, Social Affairs and Family, it was 7.54 percent in September. The Slovak Statistics Office, using a different methodology, records unemployment at about 10 percent.

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