Under influence from COVID-19 crisis the number of employed people in Latvia may decline by 7.5% or by 69,000, whereas the unemployment level in 2020 may increase to 11%, according to the report from Economy Ministry on the medium and long-term outlooks for the labour market.
The ministry notes that along with the rapid spread of COVID-19 in the world and the drop of economic activities since March there has been a rapid decline observed in Latvia’s labour market.
The registered unemployment level has increased by 2% since the beginning of March, to 8.3% in mid-May. At the same time, there has been a rapid decline of the number of vacant jobs – by more than 14,000.
The ministry notes that the situation with the labour market has stabilized and the increase of unemployment levels has become slower since the beginning of May. The number of vacant jobs, however, has started increasing.
The report also outlines the industries that have suffered the most because of COVID-19 crisis – aviation, restaurants, bars, public catering, international passenger transports, art, culture and entertainment, hotels and tourist accommodations, conference and exhibition organization, car rent, rent of equipment and material means, travel bureaus and tourism operator services, sports objects, clubs and fitness centres.
Economy Ministry predicts that because of COVID-19 pandemic unemployment in Latvia will increase in 2020. However, in future years it will reduce again, coming close to its natural level.
Outlooks suggest that the unemployment level may drop as far as 5.5% until 2027. The number of job seekers may reach 53,000.
After 2027 unemployment indexes will stabilize within 5-6%. The negative influence of demographic trends on labour force supply will be largely compensated with increased economic activity of residents and equalization of the flow labour force migration. (BNN/Business World Magazine)
