Untypical rise in unemployment in July
Published: Tuesday, Aug 6th 2024, 10:30
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The Swiss unemployment rate remained at 2.3% in July. Nevertheless, the number of unemployed increased noticeably. This is atypical for the summer month.
At the end of July, 107,716 people were registered as unemployed in the regional employment centers (RAV), as reported by the State Secretariat for Economic Affairs (Seco) on Tuesday. This was 3198 more than in June. This is the first increase since January.
Boris Zürcher, Head of the Labor Directorate at Seco, spoke of a "quite significant increase". This is all the more remarkable given that unemployment usually falls or at least remains stable in July.
This time, however, there were only slight seasonally adjusted declines in the construction and hospitality sectors, he explained. And there were increases in other sectors.
Also an increase on an adjusted basis
Adjusted for seasonal effects, the number of unemployed rose by 2436 people. The adjusted unemployment rate thus increased from 2.4 percent to 2.5 percent.
The unemployment rate is subject to seasonal fluctuations because there is more or less work in some sectors at certain times of the year. For example, many construction sites are closed in winter and there is less work in tourism in the off-season. This is masked out by the adjusted figure.
International environment
According to Zürcher, the main reason for the rise in unemployment figures is "the weaker economic development, particularly in an international context". It is well known that the local mechanical, electrical and metal industries in particular have been suffering from subdued international demand for months.
There were also special effects in July. For example, the number of young unemployed people (15 to 24-year-olds) rose by almost 1,000. This is usual for this month because many young people complete their training in this month, have no follow-up solution and therefore register with the RAV as a precaution, according to the Seco man.
Gradual normalization
All in all, Zürcher still sees the current trend as a gradual normalization following the extremely low figures of the post-corona boom. The current figure of just under 108,000 unemployed is around 20,000 higher than the previous year's figure. In a long-term comparison, however, it is not out of line.
According to Zürcher, the outlook has not clouded over. He continues to expect an average unemployment rate of 2.4% for the current year. He therefore expects the situation to stabilize over the remainder of the year.
One reason for his confidence is probably the trend in short-time working. There is still no dramatic increase. On the contrary, in May - the data is reported with a delay - only 4798 people were on short-time work, which is 1229 fewer than in the previous month. The number of companies affected fell by 67 to 223.
©Keystone/SDA
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