New job openings first in export industries
As predicted, unemployment continued to grow in January but at a slower pace, 0.6 percentage points, with the level of registered unemployment reaching 16.6% at the end of the month. Overall, this development was related to a gradual improvement in fundamental factors (macroeconomic indicators) as the export opportunities expanded. Moreover, it must be taken account that the decision to limit the large-size unemployment benefits for those registering after 31 December 2009 prompted many job seekers to register with the State Employment Agency by that date. As a result, there was a surge of registered unemployment in December.
The data obtained from the regular Latvia-related surveys of entrepreneurs by the European commission indicate that the moment that new job openings will appear in the economy is not far. Processing industry enterprises are the most optimistic regarding the prospects of expanding both production and employment. That could be related both to the orientation of the industry toward export and the fact that a substantial increase in productivity over 2009 allowed the processing industry to be the first to reduce the gap formed in previous years between salaries and productivity.