No major changes in Estonia's labor market in 2016 ({{commentsTotal}})

Cheese being packed at an E-piim cheese factory. Photo is illustrative.
Cheese being packed at an E-piim cheese factory. Photo is illustrative. Source: (Margus Ansu/Postimees/Scanpix)

According to a Tuesday press release by Statistics Estonia, in 2016, the unemployment rate was 6.8 percent, employment rate 65.6 percent and labor force participation rate 70.4 percent.

Within one year, an additional 8,300 people entered the labor market, mainly resulting in a decrease in the number of inactive persons. Compared to 2015, the number of inactive people on the labor market had decreased by 9,700.

In the fourth quarter of 2016, compared to the same period one year prior, the unemployment rate had increased by 0.2 percent, with the number of unemployed persons increasing by 1,200, while the employment rate remained steady at 65 percent.

In 2016, the number of persons active on the labor market was estimated to be 691,400, 644,600 of which were employed and 46,700 of which were unemployed. The unemployment rate increased by 0.6 percent compared to 2015. The number of unemployed persons, which had been decreasing since 2011, increased again in 2016, by a total of 4,400 persons compared to the previous year. The increase in the number of unemployed persons was caused by the decrease in the number of inactie persons, which was partly the result of the Work Ability Reform.

In 2016, there were 26,400 unemployed men and 20,400 unemployed women in Estonia. Although the number of active people on the labor market increased rapidly in the second and third quarters of last year, the year as a whole did not bring about any major changes.

The labor force participation rate, i.e. the share of the labor force in the population aged 15-74, increased by one percent in 2016 compared to the previous year. Although there were no major changes in the employment rate in 2016, it did increase among men and women, reducing the employment gap by 0.4 percent and reaching 7.6 percent. The employment gap among the population aged 25-49 was 12.7 percent in 2016, an 0.8-percent increase over 2015 figures.

Smallest number of inactive persons since Estonia regained independence

In 2016, the number of inactive working-age persons in Estonia aged 15-74 was 290,800 persons, a drop of about 10,000 compared to the previous year. The primary reasons for being inactive on the labor market remain retirement, ongoing studies and illness or disability.

Although the main reason for being inactive among both men and women is retirement, in 2016, the number of women who were inactive due to retirement decreased the most, while the biggest decrease for men occurred among those who remained off the labor market due to illness or disability. In 2016, compared to 2015, the number of inactive persons on the labor market among the prime working age population, i.e. persons aged 20-64, decreased by 6,000 persons, with the number of inactive persons in 2016 reaching 144,600, which is also the smallest number of inactive persons aged 20-64 since Estonia regained its independence in 1991.

Editor: Aili Vahtla



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