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LABOUR SHORTAGE AND LABOUR RETENTION AS
A POSSIBLE STRATEGY IN A DIFFICULT ECONOMIC
SITUATION BASED ON THE EMPIRICAL DATA OF
A TRANSITIONING ECONOMY
———————————————————————————————————————
Kőmüves, Z. S., Poór, J., Mura, L., Tóth, A., Varga, E., Hollósy-
Vadász, G.
———————————————————————————————————————
Zsolt Sándor Kömüves / Hungarian University of Agriculture and Life Sciences, Institute of Agricultural
and Food Economics, Department of Agricultural Management and Leadership Science, Páter K. u.1.,
2100 Gödöllő, Hungary. Email: komuves.zsolt.sandor@uni-mate.hu
József Poór / J. Selye University, Faculty of Economics and Informatics, Department of Management,
Bratislavská cesta 3322, 945 01 Komárno, Slovakia. Email: poorj@ujs.sk
Ladislav Mura / University of Economics in Bratislava, Faculty of Commerce, Department of Tourism,
Dolnozemská cesta 1, 852 35 Bratislava, Slovakia. Email: ladislav.mura@euba.sk (corresponding
author)
Arnold Tóth / Budapest Business University, Faculty of Finance and Accountancy, Department of
Business Economics, Buzogány u. 11-13, 1149 Budapest, Hungary. Email: toth.arnold@uni-bge.hu
Erika Varga / Hungarian University of Agriculture and Life Sciences, Institute of Rural Development and
Sustainable Economy, Department of Foreign Languages, Páter K. u. 1., 2100 Gödöllő, Hungary. Email:
varga.erika@uni-mate.hu
Gábor Hollósy-Vadász / self-employed, 1028 Budapest, Rend Street, Hungary. Email:
hvadaszg@gmail.com
Abstract
In the article, the Hungarian results of the research conducted in Central and Eastern
European (CEE) countries are presented. The main objective of the study was to demonstrate
an examination of organizational responses to labour shortages and labour retention
strategies based on organisational size and ownership background. In the theoretical part,
we present the general situation of the Hungarian labour market and then discuss the effects
of COVID-19 and the Russian-Ukrainian war, followed by labour shortage and retention. Our
research was based on a survey of 383 organizations in Central and Eastern European
economies, during which four hypotheses were tested. The SPSS 27.0 software package
was used to evaluate the results. In the findings, we confirmed that organisations of various
ownership and size differ in the means they use to retain the labour force and also in the
factors that contribute to labour shortages in different positions. As an implication of
management and economics, we found that size and ownership do not only affect retention
strategy as suggested by previous literature but also the factors that contribute to labour
shortages in different positions.
Implications for Central European audience: A novel feature of the paper is that it takes
into account the effects of organization size and ownership while analysing the consequences
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of the Russian-Ukrainian war for the first time. It is also the first Hungarian study to investigate
the effect of an economic crisis due to the Russian-Ukrainian war on labour retention and
labour shortage by the size and ownership of organizations. The findings would set
a comparison for corporations in Central European countries too.
Keywords: labour shortage; labour retention; organisational characteristics; organisational
and management responses
JEL Classification: J40, J50, J60
Introduction
The labour market in Hungary has been transformed significantly over the past few years,
changing the way employees relate to employers. Two or three decades ago, life-long
employment in one company or organisation was still typical. Today, it is no longer the case.
One of the key issues in Hungary today is the dramatic increase in labour shortages, which
have been influenced by a variety of factors, including post-regime emigration, adverse
demographic factors, the economic crisis and wage differentials within the European Union
(Brixiova et al., 2009; Vojtovič et al., 2021). The economic crisis in 2008 already showed in
the recent past how dramatically the situation in the labour market can change (Jaros et al.,
2014). Recently, three additional factors have been associated with the aforementioned
causes; the global coronavirus pandemic, the opening and rebound of the economy, and the
difficult economic situation due to the current Russian-Ukrainian war (Karácsony & Pásztó,
2021; Hitka et al., 2021; Schiffer, 2023).
In the theoretical part of our paper, we first describe, among other things, the general situation
of the Hungarian labour market and then discuss the effects of COVID-19 and the Russian-
Ukrainian war. Next, we review some current tendencies in the labour market with the main
factors that determine the management of labour shortages and the main strategic features
of labour retention. Our paper will mention and present a number of other drivers following
the three important influencing factors indicated earlier. However, we are convinced that
many of the changes in the labour market had already taken place before the current difficult
and critical economic situation (Cseh-Papp et al., 2018). In the introduction to the
methodological part of our paper, we present two research questions (about ownership
structure and organisational size) against which we test four hypotheses for 383
organisations (companies and institutions) in Hungary.
Our empirical research presented in this paper was conducted in the framework of a V4
(Czech Republic, Poland, Hungary and Slovakia) and VEGA (Scientific Support Agency of
the Ministry of Education, Science, Research and Sports of the Slovak Republic) project for
two other Eastern European countries.
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1 Theoretical background and hypotheses development
1.1 The labour market situation in Hungary between 2020 and 2023
In 2020, the number of people employed in Hungary was 4,603,000 (15–74 years), 41,000
fewer than in the previous year (KSH, 2022). The reduction in employment was mainly due
to a decrease in the number of people in public work and in the number of people working
abroad (Fazekas et al., 2020).
In 2021, the average number of people employed in accommodation and food services fell
by about a quarter as a result of the pandemic, but there were also reductions in the number
of people employed in hotels and restaurants, manufacturing, transport and storage (Grotte
et al., 2021; Fauska et al., 2013).
The introduction of the home office option also significantly reduced the decline in
employment. The share of employees working remotely or in a home office was over 20% in
Budapest, 10% in Pest county and lower in the rest of the country, but higher than in 2020
everywhere (Illésy & Huszár, 2022).
The number of teleworkers and home office workers remained high.
In 2022, the annual average unemployment rate was 3.6 per cent, lower than that of the same
period in the previous year. Hungary's unemployment rate is thus the sixth highest among
the Member States and 2.5% below the EU average. The number of job vacancies continued
to rise over the year, the largest number of them in manufacturing and administration.
The high inflation was partly driven by factors stemming from the Russian-Ukrainian conflict,
which had a negative impact on energy prices, supply chains and procurement costs.
In April 2023, the number of employed persons reached 4,710,000. The number of
unemployed increased to 190,000 compared to the previous year, bringing the
unemployment rate to 3.9 per cent (KSH, 2023).
1.2 The impact of the pandemic and war on the labour market
In 2020, the outbreak of COVID-19 caused a more serious labour market catastrophe than
the global financial crisis of 2008. To counteract the negative consequences of the economic
crisis on employment during the pandemic, all EU member states formulated job protection
policies. Although job retention programmes have the same objective, there are major
differences in the institutional setup and functional theory of each program (Müller et al., 2022;
Verick et al. 2022).
While the labour market of the developed nations recovered quickly from the COVID-19
pandemic, now we are facing labour shortages all around the world. This picture is mostly
influenced by cyclical considerations, as workers are more prone to switch jobs in the hope
of finding better employment during times of tight labour markets (Causa et al., 2022; Ando
et al., 2022; Navickas et al., 2022). According to Astorquiza Bustos et al. (2022), the most
influencing structural changes were obvious for young people and in the artistic activities
sector.
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After the pandemic, we soon had to face another shock in the economy. With Russia's war
against Ukraine, global economic conditions suddenly changed. With the outbreak of the war,
production declined by around 1% via the energy intensity channel while turnover increased,
reflecting sales from stock. Businesses protect employment through temporary jobs with 10%
more applications (Hutter & Weber, 2022).
1.3 Current trends in the labour market
Teleworking or home-office work still accounted for 7.2 per cent of the employed, 0.9
percentage points lower than in the previous year and 5.3 percentage points lower than two
years earlier. Another important change is connected to technology. The "Industry 4.0"
phenomenon, which is currently accelerating the digitization of the industry, is responsible for
many changes in the skill set of the labour force, including greater productivity and
connectedness (Androniceanu et al., 2020; Habánik et al., 2021; Veszprémi Sirotková &
Orfánusová, 2021). Labour market developments are influenced by a number of factors,
which are also affected by the constantly changing technological, social and economic
environment (Árva, 2023; Jafir & Ahmed, 2023; Smerek & Vetráková, 2020).
There has been a long-standing debate about whether robotisation, new digitalisation
technologies and nowadays artificial intelligence (AI) are creating significant or completely
new demands on employees (Eftimov & Kitanovikj, 2023). Several authors estimate that
hundreds of millions of people could lose their jobs in both physical and mental occupations
as a result (Susskind & Susskind, 2015; Hess & Ludwig, 2017). Other authors, in turn, believe
that new technologies will not only destroy jobs but could create millions of jobs (Harari,
2018), influencing positively employment and productivity in the long run (Şahin, 2020).
If we look at the labour market in developed countries over the last two hundred years, we
can observe many similar trends. To date, the U.S. agricultural employment share is 1.3%,
industry 12.8%, and services 80%, respectively (U.S. Bureau of Labor Statistics, 2023).
Similar trends are apparent in the European Union, including domestic labour market
statistics: agriculture (3.8%), industry (16%), and services (80.2%) (Karácsony & Pásztó,
2021).
Concerning the trends nowadays, it is worth mentioning the effect of migration. The
participation in intercontinental migration is expected to continue in the CEE region, driven
by demographic and economic catalysts. All companies, governmental decision-makers, and
society must constantly and continuously prepare for the integration of the newly arrived
workforce (Bite et al., 2020; Oliinyk et al., 2022).
1.4 Labour shortage and labour retention
In addition to the aforementioned industrial distribution, it is worth examining how different
organisational characteristics, such as size or form of ownership, among others, affect labour
employment, including labour shortages and labour retention.
Recent research on skill gaps and structural labour shortages has analysed how the
relationship between structural labour shortages and the business cycle fluctuates based on
how policies might help manage structural labour shortages (Brunello & Wruuck, 2021).
To maintain smooth operations and the cost of staff turnover, organisations are increasingly
focusing on retention management (Dajnoki & Héder, 2017). Retention management focuses
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on eliminating or reducing voluntary, dysfunctional departures (Kozák, 2022). It refers to
a targeted set of measures designed and implemented to keep all employees, or a group of
current employees employed for as long as possible (Kozák & Dajnoki, 2019). Retention
strategies are characterized at the macro level by characteristics such as skills shortages,
recruitment methods, internships, scholarship programmes, education, training (Kőmüves et
al., 2022; Zaharia et al., 2022; Samoliuk et al., 2021), as well as organizational characteristics
such as organization size, ownership, scope of activities, pay, rewards (Bakker et al., 2004),
organizational support (Hu et al., 2013; Urikova et al., 2013); organizational culture and
business strategies (Kozák, 2022), and individual factors such as perceptions of career,
growth, learning, development opportunities (Mauno et al., 2007; Boyd et al., 2011; Inoue et
al., 2012; Dzuro et al., 2022).
Based on the literature review, we formulate the following research questions:
1) Do organisations differ in the means they use to retain their workforce based on their
ownership and size?
2) Do organisations differ in the factors that contribute to labour shortages in different
positions based on their ownership and size?
The following hypotheses related to the research questions are tested:
H1: Organisations of various sizes differ in the means they use to retain their workforce.
H2: Organizations of various sizes differ in the factors that contribute to the development of
labour shortage in different positions.
H3: Organizations of various forms of ownership differ in the means they use to retain the
labour force.
H4: Organisations of various forms of ownership differ in the factors that contribute to the
development of labour shortage in different positions.
2 Research methodology
2.1 Research design
The research is part of an international survey of the V4 countries (Czech Republic, Poland,
Hungary, Slovakia). In the present study, we analyse only national data, which was collected
in the autumn of 2022 by filling in an online questionnaire using a snowball sampling method.
The questionnaire contains 24 questions, some of which are multiple-choice, others are on
a 1–5 point Likert scale, and there are also some explanatory questions. The items of the
questionnaire can be grouped into four categories: 1) Questions in this category ask about
the characteristics of the organisation, e.g., annual turnover, and number of employees. 2)
Questions in this group ask about strategies for retaining staff and means of dealing with
labour shortage. 3) Questions in this category ask about the potential benefits of using
robotisation. 4) Questions in this group ask about the respondents' demographic information,
e.g., gender and age.
The SPSS 27.0 software package was used to evaluate the results.
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2.2 Population and Sampling
During the data collection, 383 domestic organisations completed the questionnaires. The
distribution of organisations by industry is shown in Table 1 (Not all respondents answered
all questions, so the missing row in the table shows the number of respondents). The table
shows that most organisations (15.9%) were active in trade, while the fewest were active in
telecommunications (0.8%).
Table 1 | Breakdown of organisations by industry (n=383)
Sector
Number
Percentage
Manufacturing
60
15.7%
Trade
61
15.9%
FMCG
5
1.3%
Finance
22
5.7%
Information Technology
18
4.7%
Telecommunications
3
0.8%
Logistics
12
3.1%
Energy
9
2.3%
Agriculture, forestry and fishing
14
3.7%
Services
95
24.8%
Public administration
24
6.3%
Other
53
13.8%
Missing
7
1.8%
Total
383
100%
Source: authors’ own editing
Table 2 shows the breakdown of organisations by the form of ownership. Most organisations
(50.4%) have a domestic private owner. Almost a quarter of the organisations (24.8%) are
foreign-owned. Only 3.4% of organisations are of mixed ownership.
Table 2 | Breakdown of organisations by form of ownership (n=383)
Sector
Number
Percentage
Domestic private
193
50.4%
Domestic public
72
18.8%
Foreign
95
24.8%
Mixed
13
3.4%
Missing
10
2.6%
Total
383
100%
Source: authors’ own editing
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Table 3 shows the organisations by the distribution of turnover. Most (20.1%) have an annual
turnover between EUR 300,001 and EUR 3,000,000. 13.6% of organisations have an annual
turnover of EUR 300,000,000 or more.
Table 3 | Breakdown of organisations by turnover (n=383)
Sector
Number
Percentage
below 30,000 EUR
48
12.5%
between 30,001 and 300,000 EUR
70
18.3%
between 300,001 and 3,000,000 EUR
77
20.1%
between 3,000,001 and 30,000,000 EUR
67
17.5%
between 30,000,001 and 300,000,000 EUR
44
11.5%
above 300,000,000 EUR
52
13.6%
Missing
25
6.5%
Total
383
100%
Source: authors’ own editing
3 Results and discussion
Based on the responses, 153 (39.9%) organisations were affected by COVID-19 in terms of
labour retention, while 194 (50.7%) were not (36 (9.4%) did not answer this question). Based
on the responses, 75 (19.6%) organisations were affected by the Russian-Ukrainian war in
terms of labour retention, while 272 (71%) were not (36 (9.4%) did not answer this question).
The responses show that 202 (52.7%) organisations were affected by labour shortages last
year, while 146 (38.1%) were not affected (35 (9.1%) did not answer this question). In this
paper, we present only results where p ≤0.05.
In the following paragraphs, we present the results of the LSD test using ANOVA and post
hoc procedures.
Based on the ANOVA test, by ownership, there is a significant difference in the extent to
which the labour drain of competitors contributes to the labour shortage of higher education
graduates ((F(3)= 3.209, p=0.24). Based on the post hoc test, there is a significant difference
between domestic private and domestic public-owned organisations (p=0.005) and between
domestic private and foreign-owned (p=0.050).
Based on the ANOVA test, by ownership, there is a significant difference in the extent to
which the labour drain of competitors contributes to the labour shortage of administrative
workers ((F(3)= 3.192, p=0.24). Based on the post hoc test, there is a significant difference
between domestic private and domestic public-owned organisations (p=0.002).
Based on the ANOVA test, by ownership, there is a significant difference in the extent to
which too low wages contribute to the labour shortage of higher education graduates ((F(3)=
7.297, p=0.001). Based on the post hoc test, there is a significant difference between
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domestic private and domestic public-owned organisations (p=0.001) between domestic
public-owned and foreign-owned (p=0.001) organisations.
Based on the ANOVA test, by ownership, there is a significant difference in the extent to
which too low wages contribute to the labour shortage of administrative workers ((F(3)=
3.295, p=0.021). Based on the post hoc test, there is a significant difference between
domestic private and domestic public organisations (p=0.003).
Based on the ANOVA test, by ownership, there is a significant difference in how poor working
conditions contribute to the labour shortage of higher education graduates (F(3)= 8.770,
p=0.001). The post hoc test indicates significant differences between domestic private
and domestic public (p=0.001), domestic public and foreign (p=0.001), and domestic public
and mixed (p=0.020).
Based on the ANOVA test, by ownership, there is a significant difference in how poor working
conditions contribute to the labour shortage of salespersons ((F(3)= 2.698, p=0.048). Based
on the post hoc test, there is a significant difference between domestic private and domestic
public (p=0.013), domestic public and foreign (p=0.016) owned organisations.
Based on the ANOVA test, by ownership, there is a significant difference in how poor working
conditions contribute to the labour shortage of administrative workers ((F(3)= 4.707,
p=0.003). Based on the post hoc test, there is a significant difference between domestic
private and domestic public (p=0.001), domestic public and foreign-owned (p=0.007)
organisations.
Based on the ANOVA test, by ownership, there is a significant difference in how lack of
transport infrastructure contributes to the labour shortage of salespersons ((F(3)= 3.038,
p=0.031). Based on the post hoc test, there is a significant difference between domestic
private and foreign-owned (p=0.042), domestic public and foreign-owned (p=0.019), and
domestic public and mixed-owned (p=0.045) organisations. The mean scores are presented
in Table 4.
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Table 4 | Assessing the factors that contribute to labour shortages by ownership background
Assessing how competitors' labour drain affects the labour shortage of higher education graduates
domestic private
domestic public
foreign-owned
mixed
m= 3.1
SD= 1.4
m= 3.8
SD= 1.4
m= 3.5
SD= 1.4
m= 3.2
SD= 1.5
Assessing how competitors' labour drain affects the labour shortage of administrative workers
domestic private
domestic public
foreign-owned
mixed
m= 2.6
SD= 1.3
m= 3.3
SD= 1.2
m= 2.9
SD= 1.3
m= 2.7
SD= 1.6
Assessing how low wages of higher education graduates contribute to labour shortage
domestic private
domestic public
foreign-owned
mixed
m= 3.1
SD= 1.5
m= 4.1
SD= 1.1
m= 3.2
SD= 1.2
m= 4.0
SD= 1.4
Assessing how low wages of administrative workers contribute to labour shortage
domestic private
domestic public
foreign-owned
mixed
m= 2.9
SD= 1.2
m= 3.5
SD= 1.2
m= 3.1
SD= 1.2
m= 3.6
SD= 1.7
Assessing how poor working conditions for higher education graduates contribute to labour shortage
domestic private
domestic public
foreign-owned
mixed
m= 1.7
SD= 1.1
m= 2.6
SD= 1.3
m= 1.6
SD= 1.0
m= 1.4
SD= 0.5
Assessing how poor working conditions for salespersons contribute to labour shortage
domestic private
domestic public
foreign-owned
mixed
m= 2.4
SD= 1.4
m= 2.1
SD= 1.4
m= 1.9
SD= 1.
m= 2.7
SD= 1.4
Assessing how poor working conditions for administrative workers contribute to labour shortage
domestic private
domestic public
foreign-owned
mixed
m= 1.6
SD= 1.0
m= 2.4
SD= 1.4
m= 1.7
SD= 1.2
m= 1.6
SD= 0.8
Assessing how lack of transport infrastructure for salespersons contributes to labour shortage
domestic private
domestic public
foreign-owned
mixed
m= 1.8
SD= 1.1
m= 2.0
SD= 1.3
m= 1.4
SD= 0.8
m= 1.0
SD= 0.0
Source: authors’ own editing
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Based on the ANOVA test, by ownership, there is a significant difference in the importance
of personal development opportunities in retaining employees ((F(3)=3.265, p=0.022). Based
on the post hoc test, there is a significant difference between domestic private and foreign-
owned (p=0.007), domestic public and foreign-owned (p=0.006) organizations.
Based on the ANOVA test, by ownership, there is a significant difference in the importance
of feedback in retention ((F(3)= 4.512, p=0.004). Based on the post hoc test, there is a
significant difference between domestic private and foreign-owned (p=0.001), domestic
public and foreign-owned (p=0.003) organizations.
Based on the ANOVA test, by ownership, there is a significant difference in the importance
of a predictable career path in retaining employees ((F(3)= 2.699, p=0.048). Based on the
post hoc test, there is a significant difference between domestic private and domestic public-
owned organizations (p=0.024) and domestic private and foreign-owned organizations
(p=0.038). The mean scores are presented in Table 5.
Table 5 | Assessing retention factors by ownership background
Personal development opportunities
domestic private
domestic public
foreign-owned
mixed
m= 3.7
SD= 1.0
m=3.6
SD= 1.0
m= 4.1
SD= 0.7
m= 4.0
SD= 1.2
Feedback
domestic private
domestic public
foreign-owned
mixed
m= 3.6
SD= 1.0
m=3.6
SD= 1.0
m= 4.1
SD= 0.8
m= 4.0
SD= 1.1
Predictable career path
domestic private
domestic public
foreign-owned
mixed
m= 3.5
SD= 1.0
m=3.8
SD= 1.0
m= 3.8
SD= 0.8
m= 3.9
SD= 1.1
Source: authors’ own editing
We now look at the impact of organisational size. The ANOVA test indicates that by
organisational size, there is a significant difference in the extent of the labour drain effect of
competitors on the labour shortage of higher education graduates ((F(7)= 2.911, p=0.006).
The post hoc test indicates a significant difference between organisations with 2–9 and 251-
500 (p=0.020), 2–9 and more than 1000 (p=0.002), 10–50 and 251-500 (p=0.021), 10–50
and more than 1000 (p=0.001) employees.
The ANOVA test indicates that by organisational size, there is a significant difference in the
extent to which the labour drain of competitors contributes to the labour shortage of
salespeople ((F(7)= 2.073, p=0.048). Based on the post hoc test, there is a significant
difference between organisations with 10–50 and 251–500 (p=0.027), 10–50 and over 1,000
(p=0.027), 51–100 and 251–500 (p=0.008), 51–100 and over 1000 (p=0.008) employees.
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The ANOVA test indicates that by organisational size, there is a significant difference in the
extent to which the labour drain of competitors contributes to the labour shortage of
administrative workers ((F(7)= 2.080, p=0.046). Based on the post hoc test, there is a
significant difference between organisations with 2-9 and more than 1,000 employees
(p=0.007), 10–50 and more than 1,000 employees (p=0.001), 51–100 and more than 1,000
employees (p=0.039).
The ANOVA test indicates that by organisational size, there is a significant difference in the
extent to which problems in the education system contribute to the labour shortage of manual
workers ((F(7)= 2.848, p=0.008). Based on the post hoc test, there is a significant difference
between organisations with 2-9 and 101–250 (p=0.004), 10–50 and 101–250 (p=0.001), 51–
100 and 101–250 (p=0.011), 101–250 and 251–500 (p=0.001), 101–250 and 501–1000
(p=0.001), 101–250 and more than 1,000 (p=0.002) employees.
By organisational size, the ANOVA test revealed a significant difference in the extent to which
poor working conditions contribute to the labour shortage of manual workers ((F(7)= 2.134,
p=0.042). Based on the post hoc test, there is a significant difference between organizations
with 2-9 and 101–250 (p=0.027), 2-9 and more than 1,000 (p=0.022), 10–50 and more than
1,000 (p=0.039), 101–250 and 501–1,000 (p=0.029), 501–1,000 and more than 1,000
(p=0.026) employees.
The ANOVA test indicates a significant difference in the extent to which the lack of transport
infrastructure contributes to the labour shortage of salespeople by organisational size ((F(7)=
2.087, p=0.048). The post hoc test indicates significant differences between organisations
with 2–9 and 10–50 (p=0.021), 10–50 and 51–100 (p=0.004), 10-50 and 251–500 (p=0.029),
51–100 and 501–1,000 (p=0.019) employees.
The ANOVA test revealed a significant difference in the extent to which difficulties in
reconciling work and private life contribute to the labour shortage of higher education
graduates by organisational size ((F(7)= 2.256, p=0.031). The post hoc test indicates
a significant difference between organisations with 2–9 and 51–100 (p=0.018), 2–9 and 101–
250 (p=0.040), 51–100 and 501–1,000 (p=0.040), 51–100 and more than 1,000 (p=0.006),
101–250 and more than 1,000 (p=0.018) employees.
The ANOVA test indicates a significant difference in the extent to which difficulties in
reconciling work and private life contribute to the shortage of salespersons by organisational
size ((F(7)= 2.162, p=0.040). The post hoc test indicates a significant difference between
organisations with 1 and 10–50 (p=0.014), 1 and 51 and 100 (p=0.025), 1 and 101–250
(p=0.42), 2–9 and 10–50 (p=0.025), 10–50 and more than 1,000 (p=0.006), 51–100 and more
than 1,000 (p=0.038) employees.
The ANOVA test indicates a significant difference in the extent to which difficulties in
reconciling work and private life contribute to the labour shortage of administrative staff
((F(7)= 2.272, p=0.030) by organisational size. The post hoc test indicates significant
differences between 1 and 10–50 (p=0.010), 1 and 51–100 (p=0.006), 1 and 101–250
(p=0.004), 1 and 251–500 (p=0.017), 1 and 501–1,000 (p=0.039), 2–9 and 51–100 (p=0.042),
2–9 and 101–250 (p=0.028), 101–250 and more than 1,000 (p=0.040). The mean scores are
presented in Table 6.
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Table 6 | Assessing factors that contribute to labour shortage by organisational size
Assessing how the labour drain of competitors contributes to the labour shortage of higher education graduates
0–1
2–9
10–50
51–100
101–250
251–500
501–1,000
above 1,000
m=3.5
SD=1.7
m=3.0
SD=1.4
m=3.1
SD=1.5
m=3.0
SD=1.3
m=3.3
SD=1.4
m=3.9
SD=1.4
m=3.3
SD=1.2
m=4.0
SD=1.2
Assessing how the labour drain of competitors contributes to the labour shortage of salespersons
0–1
2–9
10–50
51–100
101–250
251–500
501–1,000
above 1,000
m= 2.0
SD=1.0
m= 2.9
SD=1.4
m= 2.6
SD=1.4
m= 2.3
SD=1.4
m= 3.1
SD=1.3
m= 3.5
SD=1.5
m= 2.7
SD=1.4
m= 3.3
SD=1.2
Assessing how the labour drain of competitors contributes to the labour shortage of administrative workers
0–1
2–9
10–50
51–100
101–250
251–500
501–1,000
above 1,000
m=2.6
SD=1.5
m=2.6
SD=1.4
m=2.5
SD=1.4
m=2.7
SD=1.3
m=3.0
SD=1.4
m=2.9
SD=1.3
m=3.0
SD=1.1
m=3.3
SD=1.2
Assessing how the problems of the education system contribute to the labour shortage of manual workers
0–1
2–9
10–50
51–100
101–250
251–500
501–1,000
above 1,000
m=2.6
SD=1.5
m=2.6
SD=1.5
m=2.3
SD=1.6
m=2.6
SD=1.5
m=3.9
SD=1.5
m=2.1
SD=1.1
m= 2.2
SD=1.3
m=2.6
SD=1.5
Assessing how poor working conditions contribute to the labour shortage of manual workers
0–1
2–9
10–50
51–100
101–250
251–500
501–1,000
above 1,000
m=3.6
SD=2.3
m=2.0
SD=1.2
m=2.1
SD=1.3
m=2.5
SD=1.2
m=3.0
SD=1.6
m=2.8
SD=1.6
m=2.0
SD=1.1
m=2.8
SD=1.4
Assessing how the lack of transport infrastructure contributes to the labour shortage of salespeople
0–1
2–9
10–50
51–100
101–250
251–500
501–1,000
above 1,000
m=2.2
SD=0.9
m=2.0
SD=1.2
m=1.3
SD=0.7
m=2.3
SD=1.1
m=1.5
SD=1.3
m=2.0
SD=1.1
m=1.4
SD=0.8
m=1.8
SD=1.1
Assessing how the difficulties of reconciling work and life contribute to the labour shortage of higher education
graduates
0–1
2–9
10–50
51–100
101–250
251–500
501–1,000
above 1,000
m=3.5
SD=1.9
m=2.9
SD=1.3
m=2.3
SD=1.4
m=2.0
SD=1.1
m=2.0
SD=1.1
m= 2.6
SD=1.5
m= 2.8
SD=1.5
m= 3.0
SD=1.4
Assessing how the difficulties of reconciling work and life contribute to the labour shortage of salespersons
0–1
2–9
10–50
51–100
101–250
251–500
501–1,000
above 1,000
m=3.7
SD=0.9
m=2.7
SD=1.3
m=2
SD=1.2
m=2.0
SD=1.3
m=2.1
SD=1.1
m=2.4
SD=1.4
m=2.6
SD=1.4
m=2.8
SD=1.3
Assessing how the difficulties of reconciling work and life contribute to the labour shortage of administrative
workers
0–1
2–9
10–50
51–100
101–250
251–500
501–1,000
above 1,000
m=4.0
SD=0.8
m=2.7
SD=1.2
m=2.2
SD=1.2
m=2.0
SD=1.1
m=1.9
SD=1.1
m=2.2
SD=1.2
m=2.5
SD=1.5
m=2.6
SD=1.3
Source: authors’ own editing
The ANOVA test indicates that by organisational size, there is a significant difference in the
importance of personal development opportunities in retention ((F(7)= 2.932, p=0.005). In the
post hoc test, there is a significant difference between organisations with 2-9 and more than
1,000 employees (p=0.010), 10–50 and 101–250 (p=0.008), 10–50 and more than 1,000
(p=0.001), 51–100 and more than 1,000 (p=0.028).
The ANOVA test indicates that by organisational size, there is a significant difference in the
importance of feedback in labour retention ((F(7)= 2.624, p=0.012). In the post hoc test, there
is a significant difference between organisations with 2–9 and 101–250 (p=0.004), 2–9 and
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251–500 (p=0.031), 2–9 and more than 1,000 (p=0.001), 10–50 and 101–250 (p=0.021), 10–
50 and more than 1,000 (p=0.005) employees.
The ANOVA test revealed a significant difference in the importance of a predictable career
path for labour retention ((F(7)= 4.340, p=0.001) by organisational size. Using the post hoc
test, the difference is significant for 1 and 251–500 (p=0.043), 1 and more than 1,000
(p=0.039), 2–9 and 101–250 (p=0.011), 2–9 and 251–500 (p=0.001), 2–9 and more than
1,000 (p=0, 001), between 10–50 and 101–250 (p=0.012), between 10–50 and 251–500
(p=0.001), between 10–50 and more than 100 (p=0.001), between 51–100 and more than
1,000 (p=0.033). The mean scores are presented in Table 7.
Table 7 | Assessing retention factors by organisational size
Personal development opportunities
0–1
2–9
10–50
51–100
101–250
251–500
501–1,000
above 1,000
m= 3.8
SD=0.7
m=3.7
SD=1.1
m=3.5
SD=1.1
m=3.7
SD=1.0
m=4.1
SD=0.9
m=3.9
SD=0.8
m=3.9
SD=1.0
m=4.2
SD=0.6
Feedback
0–1
2–9
10–50
51–100
101–250
251–500
501–1,000
above 1,000
m=3.8
SD=0.7
m=3.4
SD=1.1
m=3.6
SD=1.0
m=3.7
SD=1.0
m=4.1
SD=0.8
m=3.9
SD=0.7
m=3.8
SD=1.1
m=4.1
SD=0.7
Predictable career path
0–1
2–9
10–50
51–100
101–250
251–500
501–1,000
above 1,000
m=3.1
SD=1.1
m=3.3
SD=1.1
m=3.3
SD=1.0
m=3.6
SD=1.0
m=3.9
SD=0.9
m=4.0
SD=0.8
m=3.7
SD=1.0
m=4.0
SD=0.7
Source: authors’ own editing
Conclusions
In this research, we investigated organisational responses to labour shortage and labour
retention strategies based on ownership background and organisational size. There is a
labour shortage all around the world (Causa et al., 2022), which affects the whole Central
Eastern European labour market. Bite et al. (2020) expect the rise of intercontinental
workforce migration into this region. According to KSH (2023) data, the unemployment rate
in April 2023 reached 3.9%. The transformation of the labour market has recently been
accelerated not only by the COVID crisis but also by the fact that many jobs will be
transformed or eliminated in the future due to economic, technological and social changes
(Árva, 2023), as artificial intelligence may replace human resources in many jobs (Susskind
& Susskind, 2015). In our opinion, taking these into account, it is worthwhile to investigate
the retention capabilities of organisations and the emergence of labour shortages in different
positions, as well as to present good practices.
The following responses to the research questions are provided.
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1) Organisations of various ownership and size differ in the means they use to retain the
labour force.
2) Organisations of various ownership and size differ in the factors that contribute to labour
shortages in different positions.
The answers to the research questions confirm the conclusions of Bakker et al. (2004), who
argue that organisational characteristics e.g., size, and ownership background, influence
retention strategies. We can add to the conclusions of Bakker et al. (2004) that size and
ownership not only affect retention strategy but also the factors that contribute to labour
shortages in different positions.
All of these were confirmed in the hypothesis testing, where all four hypotheses were
accepted.
The verification of hypothesis H1 suggests that organisations of various sizes differ in the
means they use to retain their employees. There are significant differences in the factors of
personal development opportunities, feedback and predictable career paths. Larger
organisations use these means much more often than smaller organisations. When
examining the variance values, it can be seen that organisations with more than 1,000
employees have the lowest variance, i.e., these organisations have the most consistent views
on the means to be used in retaining staff.
The verification of hypothesis H2 suggests that organisations of various sizes differ in the
factors that contribute to labour shortage in different positions. In the case of manual workers,
educational problems do not tend to contribute to labour shortage. The exception to this is
organisations with 101–250 employees, where problems with the education system are
a problem for manual workers. We assume that this may be due to the fact that the other
organisations are able to train manual workers on the job, thereby remedying the
shortcomings of the education system. Work-life balance is only a feature of organisations
with one person, while it is not a feature of other organisations. In our opinion, this is because,
in one-person organisations, most people work from home, thus mixing work and private life,
which makes it difficult to separate work from private life.
According to H3, organisations of various ownership forms differ in the means they use to
retain their workforce. Significant differences were obtained for the same factors as when we
examined organisations by organisational size. This may be because these are the key
factors in which organisations differ by both size and ownership. Feedback and opportunities
for personal development are most prevalent in foreign-owned organisations, while
predictable career paths are more common in mixed-ownership organisations.
According to H4, organisations of various ownership forms differ in the factors that contribute
to labour shortages in different positions. For those with higher education, it is the domestic
publicly-owned organisations that are most affected by the draining effect of competition. In
our view, this may be related to the fact that wages in the public sector are generally lower
than in the private sector. This is supported by the fact that, in our study higher education
graduates in public sector organisations are the ones that consider that low wages are the
main contributor to increasing labour shortage. Higher education graduates in public sector
institutions are also the ones who perceive poor working conditions affect labour shortage
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most negatively, i.e., they entirely agree that poor working conditions contribute to labour
shortage.
In line with our research, a great number of other researchers investigated the relationship
between organizations of various forms of ownership, organizations of various sizes and the
retention of workforce as well as labour shortages in a Hungarian context during the
pandemic (e.g., Gelencsér et al., 2020; Grotte et al., 2021; Kőmüves et al., 2022). However,
our study includes some novel features.
1) Poór et al. (2023) investigated the effect of an economic crisis due to the current Russian-
Ukrainian war on the labour shortage and labour retention in the agricultural sector. The
current paper expands the scientific view of the Poór et al. (2023) as the focus is placed on
all sectors. As a result, it is the first Hungarian study that takes into account the effects of
organization size and ownership while analysing the consequences of the Russian-Ukrainian
war.
2) Previous Hungarian scholars have not investigated the effect of an economic crisis due to
the current Russian-Ukrainian war on labour retention and labour shortages according to the
size and ownership of organizations.
3) We verified the results of Kőmüves et al. (2022) as organizations of various sizes differ in
how they retain the workforce, not only during the pandemic but also during the economic
crisis due to the current Russian-Ukrainian war.
4) We also agree with Pató et al. (2022), according to whom the organizations of various
forms of ownership differ in the factors that contribute to labour shortages in different
positions.
Two methodological issues complicate our research. One of them is that our sample is not
representative, so conclusions cannot be drawn for the whole population and can, therefore,
only be considered valid for the sample. Another factor that limits the generality of the
conclusions is that our questionnaire is not validated. Accordingly, the question is how
accurately our questionnaire measures the factors intended to be examined by our
questionnaire.
However, in addition to the limitations described above, the first point to highlight is that our
sample is in line with general trends in terms of industrial and ownership form distribution
rates and trends. Secondly, it is also important to highlight that for most industries, we have
been able to include key players (companies and institutions) in our research. The problem
of validating our questionnaire is also alleviated by the fact that we also used a similar
questionnaire in 2019 to investigate turnover, labour shortages and retention in the domestic
labour market (Poór et al., 2019).
One possible thread for future research is to extend our current study with a questionnaire
validated on a nationally representative sample. Another possible future research direction is
to extend the findings of our current paper by investigating and presenting labour market
trends in the V4 labour markets. This would also include an examination of the different ways
in which organisations in different countries are trying to increase their labour retention
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capacity and the means by which they are trying to reduce the negative effects of labour
shortages.
Acknowledgement
Funding: This article was published within the framework of the international research
cooperation VEGA 1/0688/21 – “Employment strategies in the V4 countries” and VEGA
1/0718/22 “Human resources development in small and medium-sized enterprises in the
context of the 21st-century challenges”.
Conflict of interest: The authors hereby declare that this article was not submitted or
published elsewhere. The authors do not have any conflict of interest.
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The research article has been peer-reviewed. | Received: 16 January 2024; Accepted: 29 February
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