Learn smarter, not longer, crisis teaches Hungarians

Wed Mar 31, 2010 4:12am EDT
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By Gergely Szakacs

BUDAPEST (Reuters) - When Adrian Ozsvath graduated from one of Hungary's top universities in 2008, his degree seemed like a one-way ticket to success. He has been looking for a job ever since.

Two decades after communism collapsed, Hungary's employment rate is second-lowest in the European Union. A shortage of skilled labor has come to deter foreign investment, and the education system cannot respond adequately to market needs.

After elections on April 11 and 25 in which conservative opposition party Fidesz is expected to triumph, tackling these issues should be top of the agenda if the new government wants to lead the economy out of the deepest slump in nearly two decades, analysts say.

Failure to reform the education system and bring legions of inactive people back into the labor market could mean Hungary, which sought IMF aid in 2008 to avert a funding crisis, falls further behind in central Europe's race to adopt the euro.

Young graduates who invested years to earn a coveted university degree, still seen by many as a panacea against unemployment, are queuing outside a crowded labor office in central Budapest.

"I never expected it would be so hard to find a place," said Ozsvath, 26, who got his management degree at the Budapest University of Technology and Economics, one of 70 accredited institutions in a country of just 10 million people.

Ozsvath is now retraining to become a chartered accountant. A fresh start increasingly seems the only way out for thousands of young graduates like him, who have realized there is no demand for their hard-earned qualifications.

Their plight is the by-product of a growing mismatch between the education system and the labor market, two areas in need of decisive change if Hungary is to grow out of its high debt.   Continued...