The position of employees in the labour market remained favourable



  • The situation in the labour market was broadly the same as a year ago, except for in Ida-Virumaa
  • The abundance of vacancies and the more optimistic expectations of employers refer to strong labour demand
  • Productivity growth boosts the competitiveness of companies and helps preserve jobs

The decline in employment slowed in the last quarter of 2016 and several data sources confirm that the position of employees remained strong in the labour market. Statistics Estonia’s figures show that unemployment was 6.6% in the fourth quarter of 2016, which is broadly the same as a year ago.

Looking at sectors of the economy, employment increased in the service sector and decreased somewhat in manufacturing. Different from the Estonian Labour Force Survey, the data of the Tax and Customs Board on salaried workers show that employment growth slightly picked up speed in the course of 2016. Confidence indicators also point to employers’ more optimistic expectations about developments in employment, whereas a growing share of respondents say that labour shortage is preventing them from expanding their activities.   

In addition to employment data, growth in the number of vacancies also indicates strong demand for labour force. Töötukassa (the Unemployment Insurance Fund) mediated more than a third more jobs in the fourth quarter of 2016 than a year earlier. The growth continued in January 2017 – there were 4,407 active vacancy notices at the end of that month. The survey of vacant positions and the movement of labour, which covers also such vacant positions that are not listed with the Unemployment Insurance Fund, also pointed to a general growth trend in vacancies in the first three quarters of 2016. This means that those looking for a job have good chances of finding one.

Labour market developments in Ida-Virumaa have affected the unemployment rate in recent months. Economic hardships in that region, especially in the oil shale sector, increased the unemployment rate there in the third quarter of 2016, and it remained elevated also at the end of the year. Data from the Unemployment Insurance Fund also confirm that registered unemployment in Ida-Virumaa increased by a fourth by the first quarter of 2016, but the situation has improved during the past ten months.

The pickup in output and export growth in the last quarter of 2016 implies that productivity growth in manufacturing continued. The weakening of the euro and the quickening of price growth in external markets support Estonia’s export competitiveness. The strengthening competitiveness of enterprises in turn reduces the risk of job losses and unemployment growth in the future.

Additional information:
Leanyka Libeon
Public Relations Office
Tel: 668 0959
Email: [email protected]
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