Employment growth – stronger than expected
Unemployment dropped to 8.0% in the second quarter this year – 1.4 pp lower than a year ago despite record high activity rate. Annual employment growth was at 2.3% and employment rate reached new record. The number of labour force increased by 0.8% in a year despite working age population shrinking by 1.7% this year.
Outlook: employment growth should subside
Even though the number of unemployed per vacancy has increased somewhat in June and July it remains at very low levels. Moreover, almost 40% of registered unemployed have no professional education. Working age population is expected to decrease by around 1.5% a year during the next few years and activity growth is likely to slow down. Consider this it may be the last year of rising employment – unless there are substantial changes in migration policies and trends. Sustainability of economic growth will become even more dependent on investment and productivity growth as wage pressures are building up. We expect unemployment to continue decreasing and approach 7% in 2017.
For more information about this report, please contact Ms. Vaiva Šečkutė, +370 610 08360, Vaiva.Seckute@swedbank.lt
This email is sent through the Research Department’s web-based distribution system. As a subscriber you can change your settings regarding what publications you will receive by clicking “Change your settings” you can also unsubscribe by clicking "Unsubscribe".