Number of registered job seekers down for the first time in two years

Registered unemployment in April shrank by 0.6 percentage points, reaching 16.7% of the economically active population by the end of the month. It is the first decrease in the last 23 months. In April permanent employment was found by a record number of registered unemployed 8.0 thousand; the number of vacancies registered with the State Employment Agency is also up, reaching the maximum level in the last eleven months (2.1 thousand.).

The drop in registered unemployment is related to two factors.

First, the number of registered unemployed went down, both as the demand for seasonal workers grew and industry and trade indicators improved and so did the view of entrepreneurs regarding the expected developments. For instance, the monthly surveys on employment expectations of entrepreneurs conducted by the European Commission indicate that in April Latvian entrepreneurs expected greater employment in the next three months in all basic sectors and in the processing industry the balance of entrepreneur responses turned positive (more entrepreneurs expect to increase the number of their employees rather than reduce) for the first time in 30 months.

Second, the drop in unemployment level is related to the peculiarities of the methodology used by the State Employment Agency, i.e. the level of unemployment registered in the previous twelve months was calculated using the 2006-2008 average number of economically active population but in the next twelve months (starting April 2010) the 2007-2009 average was used. The changes in the number of economically active population lowered the level of registered unemployment by 0.3 percentage points. Therefore about one half of the drop in the level of registered unemployment was determined by a recalculation of the economically active population.