The labour market and consumption

The unemployment rate recorded in 2013 was higher on average than in 2012 (13.5% compared with 12.8%). However, symptoms of improvement on the labor market have been noticeable since the middle of the year. The rate of growth of employment in companies started to increase from May and, at the end of 2013, employment in this sector was slightly higher than a year earlier (by 0.3% y/y in December). The seasonal increase in the unemployment rate recorded in the final months of last year was the lowest in six years. As a result, its level in December was the same as in the previous year, i.e. it was 13.4%.

In light of the higher unemployment rate and low inflation, employers did not feel any pressure to raise salaries in 2013. The average rate of increase in monthly salaries in the national economy fell to 3.4% compared with 3.7% in the previous year. However, salaries increased in real terms by 2.5%, compared with 0.1% in 2012, because of low inflation. Real gross disposable income of households also increased, after declining slightly in 2012. In view of the low interest rates in 2013, current household deposits increased strongly with a decline in term deposits, which also favored consumption.

In the first half of the year, the rate of growth of individual consumption was still close to zero. However, the real growth in household income, with a slightly better outlook on the labor market and expanding consumer credit, has helped overcome this stagnation and, in the last quarter 2013, the rate of growth of individual consumption approached 2.1% y/y. However, throughout 2013, it was only 0.8%.