Kertti Viru, chairperson of the Estonian Hairdressers Association, told ERR that those in the profession feel the effects of the recession, and that uncertainty is the mood of the day.

"Things have quieted down a little," she said. "There are hairdressers who are fully booked and don't feel it yet, but people do take longer between trips to get their hair done."

The life of hair stylists is also made more difficult by material price hikes. Viru said that some hairdressers have doubled their prices, while the latter cannot be increased much more, meaning that costs need to be cut at the expense of profits. But the association chair said that hair stylists are better off than other service providers since that is the last beauty service people cut from their budget.

Liina Heck, owner of Lofty OÜ that runs the Intersalon beauty parlor in Tallinn's Haabersti district, said that hair dye, shampoo and other such things have become 30 percent more expensive in the past year.

"Prices are growing faster than we can keep up with in our own price formation. We can add labor costs to the mix, as employees also want to be paid more. It is quite difficult," Heck admitted.

Kertti Viru said that the share of Finnish customers has fallen considerably. While only recently there were salons that specialized in catering to Estonia's northern neighbors, not many Finns come to get their hair done in Estonia any more.

She said that hairdressers' prices are unlikely to come down as the things they need for their work keep getting more expensive.

Bank of Estonia data confirms price advance of hair styling services. The central bank's economist Lauri Matsulevitš said that eating out, but also beauty and hair styling services have become visibly more expensive in the first months of 2024.

All restaurants struggling

Ain Käpp, chairman of the Estonian Hotel and Restaurant Association and head of the Palace Hotel in Tallinn, said that hotels and restaurants are also feeling the effects of people spending less on eating out, traveling and entertainment.

"A big part of it is foreign tourism not having bounced back," Käpp said, adding that Tallinn, Tartu, Pärnu and the western Estonian islands are affected. "Looking at the end of last year, foreign tourism was down 25 percent compared to the pre-Covid period, whereas January, February and March this year have been very slow to boot."

At the same time, locals' purchasing power is waning and everyday expenses growing.

Käpp noted that more than a few restaurants have closed doors, even though the fact is not advertised. He said that eating out becoming a luxury in Estonia would be an unfortunate development as the country has skilled chefs and Michelin-star restaurants, as well as a real opportunity to be known for its good food and drink.

"Restaurants have been able to hike prices a little, accommodation providers not so much. Hotels have managed to raise prices by 4-5 percent in a situation where they're operating costs have grown by nearly 40 percent," Käpp added.

He pointed out that the accommodation sector lost over €80 million over three coronavirus years, coming down from a profit of €23-25 million in 2019. Therefore, the sector could use three or four excellent years to bounce back, while it has not seen them.

To make matters worse, accommodation providers' VAT rate is set to go from 9 percent to 13 percent from next year.

Käpp, who is not too pessimistic looking to the future as 2020 was much worse still, said that things would be much easier without the VAT hike, which the sector is trying to bring to the government's attention.

Concert tickets bought at the last minute

Emil Oja, CEO of event organizer BGM Management, noted that ticket sales headed down last year, while this year's results will become clear when summer concerns land in June.

Oja said that people increasingly leave buying tickets to the last minute, which puts organizers in a difficult position as plans are hard to make and success will often boil down to the weather on the day. The promoter said that tickets are booked in advance only if it offers considerable savings compared to buying at the last minute.

He said that the trouble started with Covid, then came the war and finally the cost of living. "First, you need to pay your bills and put food on the table, and culture inevitably comes second."

Silver Kuusik, press representative for Eesti Kontsert, also said that people have become more spontaneous when buying concert tickets, but added that classical music concerts and ticket sales have largely bounced back to the pre-Covid level. He said that people find ways of seeing their favorite artists and bands.

Emil Oja said that smaller concerts are easier to put on than major festival-like things. The promoter said that the price to see a domestic artist caps out at €30-40, while it depends on individual artists. Those who wish to attract the masses must keep prices down.

"People in Estonia are in the habit of visiting free events – fairs and the like. People are happy to consume things they don't have to pay for," he added.

But others are not feeling the pressure. Eva Palm, head of Live Nation Estonia, said that their summer concerts – Sting for instance – are sold out and they're not having any trouble selling tickets to see A-list stars.

Car repairs postponed as long as possible

Next to beauty services and entertainment, the uncertain economic situation is also forcing people to postpone more practical things, such as car repairs.

Mairo Romandi, head of service for Toyota dealer Amserv, said that customers have become more price-sensitive and postpone repair work which is not essential.

When a vehicle needs to be serviced and have its tires swapped out in spring, instead of booking two appointments a few months apart, people tend to wait and come in once to get it all done. "It's quieter than it has been, while I wouldn't say it's dead either," Romandi said, adding that February tends to be quiet from one year to the next, while March has also been slow this year.

The Amserv service chief said that customers still service their vehicles on time. Toyotas need to be serviced at least once a year or every 15,000 kilometers and a single day or kilometer over can void the warranty.

Lauri Matsulevitš said households have not cut services consumption as much as goods consumption, while the volume of services aimed at private customers, such as eating out or entertainment, has fallen in 2024.

"There are probably several reasons for this. People bought more vehicles before this year's VAT hike landed, leaving less money for other expenses," the economist suggested.

More expensive beauty services and eating out are discouraging customers and even though what foreign tourists spend in Estonia has been growing from one quarter to the next, this growth has slowed.

Matsulevitš also pointed to higher interest rates which cause larger monthly loan payments and leave households with less money to spend. He added that interest coming down should alleviate the situation somewhat.

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