Analytics, Employment, Estonia, Good for Business, Labour-market, Markets and Companies

According to Statistics Estonia, the labor force participation rate in the third quarter of 2020 was 71.8%, the employment rate was 66.3% and the unemployment rate was 7.7%, while there were 54,300 unemployed persons, which is 4,900 more than in the second quarter of the year.

Nestor noted in his weekly comment that the coronavirus restrictions will make the coming months difficult for the economy, but the hope for the vaccine to arrive soon motivates companies to hang on.

"Surprisingly, the deterioration of Estonian labor market indicators has been one of the sharpest in the European Union. Data for the third quarter are available for a small number of countries, but in the second quarter the decline in employment was even faster only in Ireland, Bulgaria and Spain," he said.

While in Estonia, the employment rate fell by 2.7% year-on-year, it decline by only 1.5% on average in the European Union. According to Nestor, the reason may lie in differences in national labor market measures and their timing.

Despite the deteriorating labor market indicators, Estonia is still among the countries with a very good labor market in European terms. In the second quarter, the employment of people aged 15-74 was higher than in Estonia only in the Netherlands and Sweden.

"Looking at the change in employment by industry, it is no surprise that most jobs have been lost in accommodation and food service activities. According to Statistics Estonia, 29,000 people worked in this field in the third quarter of 2019, but a year later 22,000, or a quarter less," Nestor said.

He added that the entertainment sector has also been hit hard, with the number of employees falling by more than 4,000 over the year. According to the Labor Force Survey, more than 4,000 jobs have also been lost in retail and wholesale trade.