The labour market improved in the summer

Autori Orsolya Soosaar pilt

Orsolya Soosaar

Economist at Eesti Pank



Unemployment fell to 5.7% in the third quarter from 6.9% in the previous quarter, and seasonally adjusted employment increased strongly. The labour force participation rate was lower in the first three quarters of the year than a year earlier though.

The recovery in employment from the crisis picked up momentum in the third quarter according to the labour force survey, and data from the Tax and Customs Board show the labour market performing even better. The tax data show that the number receiving a declared wage rose by 2.7% over the year in the third quarter to be only 0.8% or 4600 people below where it was in the same quarter of 2019.

Behind the strong recovery were changes in the structure of employment. The share of the general government in employment has increased since the pandemic started as demand has grown for public services. There were some 8200 fewer wage recipients at businesses registered in the commercial register than there were two years earlier, but 3400 more at government institutions. There remain a quarter fewer wage recipients in accommodation and food service in the private sector than there were two years ago.

Unlike the labour force survey, the register data on the unemployed and the employed do not show a fall in labour force participation. Nevertheless, people who have been unemployed for a long time are at risk of losing hope of finding a suitable job. Jobs have recovered at different rates in different sectors. This makes it important for the unemployed, whose skills and experience do not necessarily match those required in new jobs, to be able to get effective support for further training.

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