Employment adjustment in the global crisis

This paper analyzes the employment adjustment of domestic, foreign and state- owned companies before and during the global crisis. Using Hungarian firm-level data for the period between 2006 and 2012 and matching foreign and state-owned firms to domestic enterprises by industry and employment, it finds that the net job creation rate is similar in domestic and state-owned firms while it is larger by 3.5 percent in foreign-owned enterprises before the crisis. Domestic and foreign-owned firms react to the crisis in very similar fashion by dropping net job creation by about 4 percentage points. Contrary to this behaviour, state-owned enterprises do not decrease net job creation in some, and increase it by 3.5-6 percent in other regressions