Long-term unemployment at 20-year low, under-employment rises

Unemployment in Estonia has continued to fall over the past ten years, with long-term unemployment at a 20-year low.
Unemployment in Estonia has continued to fall over the past ten years, with long-term unemployment at a 20-year low. Source: Statistics Estonia

The rate of long term unemployment in Estonia in 2018 was the lowest for 20 years, according to government agency Statistics Estonia, with the labour force also increasing in size.

The average unemployment rate for the whole year was 5.4% in 2018, the agency says, with the labour force participation rate 71.9%, and the employment rate standing at 68.1%.

A total of 702,400 persons were active in the labour market through 2018, a rise year-on-year (y-o-y) of 3,600, with the number of employed persons rising by a little over 6,000 to 664,700. Conversely, the annual average number of unemployed persons was 37,700, which is 2,600 less than in 2017, according to Statistics Estonia.

The incidence of long-term unemployed (those searching for employment for 12 months or longer) was 9,400, the lowest figure for 20 years, and a fall of just over 4,00 y-o-y, through 2018.

The breakdown by demographics also revealed an overall trend of falling unemployment, and hovers around the 5% mark in most age groups (4-5% for 25-49-year olds, and 5.2% in the 50-74-year-old age bracket). This is below the EU average unemployment rate of 7% in Q1-Q3, Statistics Estonia says.

However, youth (15-24-year-olds) unemployment is higher at 11.8%, though it fell y-o-y too.

Under-employment rises

Furthermore, under-employment, defined as a person who works part-time (see below) but is both available for and desirous of additional work within two weeks, rose by 2,600 to 7,300 persons through 2018, it is reported.

The number of under-employed persons has also increased. A person is underemployed if he/she works part-time but would like to work more and is available for additional work immediately (within two weeks). In 2018, the number of under-employed persons was 7,300, which is 2,600 more than in 2017.

The number of ''inactive'' persons on the labour market also continued to fall to 2018, standing at 274,300 in 2018. The largest sub-group here was the retired, close to 90,000, with studies, illness or disability, and maternity leave being the other main causes of workplace inactivity.

Part of the explanation of the rise is labour utilisation is an increase in part-time work, which reached a record high in 2018 at 82,000 part-time workers, nearly 11,000 more y-o-y.

When taking Q4 2018 in isolation, the unemployment figure is even lower, at 4.4% y-o-y, a 10 year low, says Statistics Estonia.


Statistics Estonia is a government agency under the aegis of the Ministry of Finance, and provides public institutions, business and research circles, international organisations and individuals with reliable and objective information on the economic, demographic, social and environmental situation and trends in Estonia.

Editor: Andrew Whyte

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