Abstract
The number of people out of work is increasing in Hungary, and in other countries of Eastern Europe, as a consequence of the collapse of the Comecon market and as a side effect of economic transformation. Rising unemployment is potentially a major source of social tension, which may undermine the whole transformation process. So policy towards the labour market faces major challenges. Although in Hungary labour market policy measures were introduced relatively early, before massive unemployment appeared, the sudden rapid rise of joblessness affected the economy unexpectedly. With the number of people out of work increasing and long‐term unemployment expanding, the growing needs are constantly being confronted with very limited financial resources. This problem cannot be eased by labour market policy measures alone: economic policy also matters. However, its scope for manoeuvre is relatively low because of the high exposure of the Hungarian economy to foreign markets.
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More From: Journal of Communist Studies and Transition Politics
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