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Employment indicators improve in first quarter of 2017

Transferwise' main office in Tallinn.
Transferwise' main office in Tallinn. Source: (ERR)

According to a Monday press release by Statistics Estonia, in the first quarter of 2017, the unemployment rate was 5.6 percent, employment rate 66.3 percent and labor force participation rate 70.2 percent, the last of which reached a record level compared to the first quarters of recent years.

The unemployment rate decreased by 0.9 percent on yer and by 1 percent compared to the fourth quarter of 2016. The last time that the unemployment rate was so low, at 5.2 percent, was in the third quarter of 2015. The number of unemployed persons in the first quarter of 2017 was 38,400, down from 43,600 in the first quarter of last year.

The employment rate among 15-74-year-olds in the first quarter of the year was 66.3 percent, with the total number of employed persons reaching 646,800, marking an increase of nearly 17,000 persons, or 2.2 percent. Indicators for this year's first quarter are lower than the second and third quarters of 2016, however, which is largely due to seasonality — due to particularities of production processes and/or demand, several economic activities require more labor force during summer months.

Compared to the same quarter of last year, the labor force participation rate, i.e. the hare of the labor force in the population aged 15-74, increased among both males and females. The indicator for males increased by 1.8 percent to 74.7 percent, while the labor force participation rate of females increased by 1.3 percent to 65.9 percent. The employment gap between males and females aged 15-74, i.e. the difference between employment rates, climbed over a year by 1.3 percent to 7.8 percent.

By age group, as expected, the employment rate was lowest due to ongoing studies among 15-24-year-olds. Nevertheless, the employment rate among 15-24-year-olds increased by 4.8 percent to 36.7 percent in the first quarter of this year. At the same time, due to an increase in the number of unemployed persons, the unemployment rate in this age range increased as well.

 Both among non-Estonians and Estonians, the number of employed persons has increased and the number of unemployed persons decreased. The unemployment rate among Estonians was 4.2 percent, down 1 percent from the previous quarter and 0.9 percent on year. The unemployment rate among non-Estonians remained notably higher, at 8.7 percent in the first quarter of 2017, but was nonetheless down 1.1 percent compared to the previous quarter and on year alike. The number and share of non-Estonians active in the labor market has improved quite considerably — their employment rate in the first quarter of 2017 was 61.4 percent, up from 58.7 percent one year ago.

In one year, the situation in the labor market has improved — i.e. the number of inactive and unemploymed persons has decreased and the number of employed persons increased both in urban and rural areas. The employment rate in urban areas increased by two percent to 67.1 percent and in rural areas by 2.4 percent to 64.5 percent. There have been no major changes in between economic sectors in recent years and even seasonal fluctuations between sectors in recent years have been relatively marginal compared to earlier years. Comparing the dynamics of only first quarters, the share of employed persons in the tertiary sector continued to grow at the expense of the secondary and primary sectors.

Editor: Aili Vahtla

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