The number of the employed was record-high, up by +3.2% in a year, in the fourth quarter. Employment increased in healthcare, IT, manufacturing, and retail sectors. A significant part of the employment growth comes from the Ukrainian refugees. 9,000 refugees have found work so far and 6,000 are still looking for a job.
Economic slowdown has made the labour market less tight
Demand for labour has decreased in recent months, while labour supply has increased. This has made life a little easier for recruiters. The number of vacancies was significantly lower in January than a year ago. Industrial and construction companies are planning to reduce their work force in the coming months, according to a survey by the Institute of Economic Research. Service companies are still expecting employment to grow.
The unemployment rate is expected to rise
In mid-February, there were 10,000 more registered unemployed people than a year ago. The increase in the unemployment rate is expected to remain moderate. According to Swedbank’s forecast, the unemployment rate will rise by about 1.5 percentage points this year and reach over 7%.
The rise in unemployment has not eased the pressure on wage growth
Despite 55,000 registered unemployed, employers are plagued by a shortage of labour. According to Statistics Estonia, there were more than 13,000 vacancies in the labour market in the third quarter. The wage growth of Swedbank’s clients has remained rapid. Swedbank forecasts an 8.5% increase in the average gross wage this year.