Utilizing Online Data in Modelling Unemployment Rates in the Czech Republic

Unemployment rate is a crucial macroeconomic aspect for each state, which aim to have it as low as possible. However, if it is too low, many problems could arise due to a large number of job vacancies and a small number of people needed for market. As the Internet is very useful nowadays, the main aim of the thesis is to investigate the relationship between the Czech unemployment rate and job search on the Internet by users who are interested in changing jobs or are unemployed and need to find some work. Thanks to the relationship, we can conclude whether online data could improve unemployment prediction, which is needed to make effective government decisions. This thesis should also provide easier and better prediction of movements in the unemployment rate, which is inaccurate as most data sources used in economics are commonly available only after a substantial lag. The study applies data freely available on the website of Integrated Portal of the Ministry of Labour and Social Affairs, which provides statistics of unemployment rates, as well as data from portal Jobs.cz, where are information about job vacancies on the portal and response of candidates to occupied positions. The thesis uses a simple autoregressive model of the unemployment in the Czech Republic and extends it with extra variables..