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"The impact of the work capacity reform in the bigger picture is definitely positive through the increase of employment, but in the first years of the reform there will definitely be problems," Erki Lohmuste, deputy head of the Finance Ministry's fiscal policy department, told BNS at a press conference on Tuesday.

While last year the unemployment rate was 6.2%, according to the spring forecast published on Tuesday the indicator is to grow to 6.6% this year, to 7.6% next year and to 8.8% in 2018. In 2019 it is expected to total 9.7% and the following year 9.8%, while without the reform unemployment would total 6.4% in all those years.

According to Lohmuste at present about half of the people incapable of working are nonactive on the labor market.

The positive impact of the reform is to gradually grow as a result of an increase in the number of employed people, the ministry said in its forecast.

The ministry is forecasting unemployment to increase to 6.6% this year. At present the employment rate is record high in Estonia at 65.2% and it sets limits to the increase in the number of employed people in the near future.