Elements of analysis of the unemployment situation in Latvia


 

In may 1997 the over fifteen years old Latvian population reaches 1’987’500,among which 1’196’900 (60,2%) are considered economically active (with or without job). When the Central Statistical Bureau of Latvia carried out the survey, 191’100 people were actively seeking a job, that is about 15.9% of the total workforce. Yet these general figures concerning the whole country conceals important differences according to the age, the sex and the education level... Such individual criteria comes to light the differences existing among the several areas of the country. The extent of contrasts between the urban regions and the rural ones prevents any global analysis and requires a differentiated study.

To illustrate the truth of these contrasts, it could be mentioned, the rural population has a share of jobseekers of 7.5%, whereas in cities Riga among them, this level gets around 19.4%. However the level of job seeking must be taken as an indicator resulting from economic as well as demographic, migratory or social ones. In fact, the increase of jobseekers shows essentially labour force flow to the city from neighbouring populations.

 

Fig.1. Share of unemployment in Latvia by districts

Conversely, a low unemployment level noted in a part of Latvia will not reflect the economic reality of this region, which is losing its industrial sector or its population. The migration of the workforce, with more and more people leaving rural area where agricultural activities are prevailing, would be the one of the factors accounting for a low level of unemployment.

Table 1. Registered unemployment level by districts (rural areas)

Districts

unemployment

level, %

Districts

unemployment

level, %

Aizkraukle

9,7

Limbaži

6,0

Alūksne

10,8

Ludza

17,9

Balvi

20,8

Madona

12,6

Bauska

6,8

Ogre

3,9

Cēsis

7,1

Preiļi

21,2

Daugavpils

13,2

Rēzekne

27,9

Dobele

9,8

Rīga

4,4

Gulbene

9,5

Saldus

4,1

Jēkabpils

13,7

Talsi

4,5

Jelgava

9,5

Tukums

5,3

Krāslava

21,6

Valka

6,9

Kuldīga

6,0

Valmiera

8,5

Liepāja

10,4

Ventspils

6,9

Table 2. Registered unemployn level in major cities

Cities

unemployment

level, %

Cities

unemployment

level, %

Rīga

3.0

Liepāja

7.3

Daugavpils

7.4

Rēzekne

11,4

Jelgava

7.5

Ventspils

3.2

Jūrmala

6.2

 

Fig.2. Urban and rural distributions according to the various populations

 

Definitions of jobseekers and registered unemployed persons

Jobseekers are persons aged 15 years and over, whether or not registered at the State Employment Service, who meet the following three conditions simultaneously:

  1. who during the reference week neither worked nor were temporarily absent from work,
  2. who had actively sought employment during the past four weeks,
  3. who were immediately available to start work within two weeks.

 

The share of jobseekers is the share of jobseekers in the economically active population.

 

Registered unemployment persons are those who have acquired the status of the unemployed. According to the act of the Republic of Latvia "On Employment" considered as unemployed is an able-bodied non-working citizen of the Republic of Latvia or a foreigner (or a person without any citizenship) who has received a licence for a permanent stay or who has a mark of the Population Register with a personal code in his/her passport and who:

  1. is of working age,
  2. does not receive any income at least to the amount of the minimum wages, is not engaged in entrepreneurial activities,
  3. is looking for work and is registered at the State Employment Service according to his/her officially registered address and applies to it at least once a month.

 

Definitions of Education levels used in this report

Taking into account that in labour market surveys concern all the population, not only those who have graduated from schools in the present education system, the definitions used by the Department of Labour statistics somewhat differ from the definistions used in the education system at present. They are:

 

 

basic education

compulsory schooling; 9 years (8 years in the previous system) year

vocational education

professional education after basic education which does not provide general secondary education

general secondary education

12-year general education leading to university admission

postsecondary vocational education

1-2 year professional programmes after general secondary education

secondary professional education

professional programmes:

  1. 4-5 yers after basic education;
  2. 2-3 years after general secondary education

leading to more complicated professions and giving access to university studies

higher education

academic or professional programmes of minimum duration 4 years

 

Jobseekers in urban zone

163’400 city population declare they are looking for a job in May 1997, which represents the 5/6 of the whole of the jobseekers in Latvia. Around 43% of jobseekers of the country are counted in the city of Riga, where are living a third of the total population of Latvia.

The situation is more or less similar for men and women as much for the job applications (53% men) as for the share of jobseekers in the economically active population that gets around 20%. Thus, one active person in five is looking for a job whatever his age is.

Under twenty-five years old youths represent just a little below a quarter of the total demand. In 54% cases they are men. Made up of men and women in equal numbers the twenty-five/forty age group represents more than one third of the total number of jobseekers. The forty/fifty constitute 22% of the jobseekers with a slight men majority (55%).


Fig.3. Breakdown of jobseekers according to age group in the urban zone

Among the fifty/sixty year olds who represent about 14% of the jobseekers in urban zones, the share of women is about 1/2. Over the age of sixty nearly 2/3 of people seeking job are men

A characteristic feature of youth unemployment is difficulties to obtain a first job (about 25%), whereas precarity and short-time working appear for twenty-five/fifty age group and especially for the least qualified (about 50%). Beyond fifty years old the unemployment leading to exclusion from labour market is caused by a lesser adaptability to the constraints of new working structures (about 25%).

Employment and professional diploma

In May 1997, 50.2 % of the total number of jobseekers had no concrete professional training - their education was either less then primary, primary or general secondary. Vocational and post secondary vocational education keeps a marginal place, whereas 10% of the jobseekers are University graduates.

 

Fig. 4. Breakdown of jobseekers by level of education in the urban zone

Women hunting for a job have a higher diploma than men do. However, because of different reasons women in Latvia all in all have a higher diploma. A serious interpretation of this point requires looking into the nature of their diploma and their unemployment period. It is at the University level that the gap between men and women is the most telling. It could be mentioned that number of specialities typical for women has decreased.

Taken both genders together, it is quite evident that these who lack professional training have difficulties to find a job, see figure 5. More than half of jobseekers have no concrete profession: their education is either general secondary, basic or less than basic.

Fig.5. Breakdown of jobseekers by education in urban areas.

To see which kind of education is more of use when looking for a job, the following comparison is presented, see Fig. 6. In fig 5 the share of jobseekers in groups of economically active population with different kinds of education is compared (e.g. in the group with higher education the number of jobseekers is divided by the number of the economically active inhabitants holding higher education diplomas.

An unemployment indicator highly linked to the diploma...

Even with a University diploma, nobody is sheltered from unemployment though this risk strongly decreases with the rising of the education level. Figure 6 shows the share of the jobseekers among the economically active population of a given education level. Four education levels are shown:

  • basic education or less,
  • secondary (general or vocational),
  • post-secondary (either professional training after general schooling or postsecondary level professional programmes of the institutions named "tehnikums", nursing schools and othe),
  • higher education.

One can easily see that the unemployment is sharply decreasing with an increasing education level. For instance, Figure 6 shows that among the economically active people with basic oer lower education 32,6% are jobseekers, while among the economically active population with higher education only 8.6% seek job

Fig. 6. Share of jobseekers in groups of economically active population with different education level.

A more detailed picture, showing the share of jobseekers in groups of e economically active men and women with different types education is shown in figure 7. A more detailed study may be required to interpret the resukts in each of genders and education types.

Fig. 7. Share of jobseekers in the economically active population by education in the urban zone

 

Out of economically active urban population 20.2% of men and 18.6% of women are jobseekers. On the whole the unemployment risk is greater for men. A greater share of jobseekers is observed among women with higher or secondary professional education. The exceptionally high level of jobseekers among women with vocational education could be explained by shrinkage of the typical female professions for which the vocational training was provided during the soviet period. In Riga the unemployment indicator is clearly higher whatever the education level may be.

 

previous job experience of jobseekers...

Even though it is difficult to draw conclusions on the impact of professional experience, it is most likely that it is a bonus to position oneself on the job market. Enterprises prefer to rely on an experienced working force especially if they are of a small size like craft industry so common in Latvia. Yet it is not sure that the nature of former professional experience is totally useful in the structure of new modes of production (in this analysis the professional experience is not taken into account if it ended three years before the survey was made).

Even among the people seeking a job industrial experience is clearly prevailing. It may be of some interest to underline the specific features of the professional experience of men and women. A job in the industry is about the third of the professional experience of the people whatever their sex is. The activities in the retail trade sector constitute the second common point to men and women with a predominance of women. Beyond this common point appears clearly the traditional distinction which characterises the labour market: activities in the health and social work or the hotels and restaurants are typically for woman; agriculture, construction and transport almost entirely for men.

Fig. 8. The five principal sectors of working experience for women in the urban zone (78% of female jobseekers in the chart)

Fig.9: The five principal sectors of working experience for men in the urban zone, 82 % men in the chart

 

Jobseekers may have a long period of previous activity

Most likely linked to the pre-1990 working organisation and to the high proportion of former wage earners over the age of thirty among the unemployed the length of activity is mostly long. More than half of the jobseekers have ten to thirty years of professional experience. For a majority of them, the difficulties for going back into a job have been made worse, and will be solved only after brushing up or acquiring new knowledge and new techniques adapted to new working situations. This finding is still more evident with women where about 75% of professional path go over ten years (compared to 69% for men). This difference is explained in part by the deep restructuring of the sectors with a prevailing female workforce.

registration at the State Employment Service and other forms of jobseeking

If 25% of urban jobseekers rely on the state services to find a job, in the city of Riga only 16% of them appeal to those. The diversity in the access to the information of job offers, the density of personal relations, the facilities of transport and a certain autonomy of the populations reduce the expectancy of jobseekers towards State Employment Service in urban zones. The lack of information on rights and duties of unemployed persons is noticed among jobseekers.

 

Jobless to find a work use four main ways: the appeal to family or friends network (23%), the advertisements (25%), the enrolment to State Employment Service (25%), and individual contact with employers directly (14%).

 

Men and women are also different in their behaviour when seeking a job. Probably for some sociological reasons, women tend to rely on a more structured system such as the enrolment to job public services (32%) or newspaper ads (26%), the appropriate numbers being 20% and 24% respectively for men.

For men, the relational system prevails either among the private sphere - questioning of relatives, friends, and acquaintances (26%). Direct contacts with employers are more characteristic for men (17%) than for women (10%).

It is possible that all mentioned means are used for jobseeking step-by-step. In a first move jobseekers appeal to the family or friends, then to the ads and direct contacts to get themselves known to the employers and eventually they resort to the State Employment Service.

Duration of jobseeking

The increasing difficulties to quickly get a job can be compared to queuing. The more new jobseekers you have, the farther for any access to a job you will ’ find the weakest populations (low education level, no qualification at all, out of date know-how, etc.).

Fig. 10. Duration of jobseeking for men and women

Over one third of jobseekers have looked for a job for twelve to twenty-four months and around 25% have been out of the system for over three years. The economic hardship generated by deep changes in the production system have apparently affected first the female population since women more seldom succeed to find a job after short unemployment periods than men. . As a general rule among these jobseekers looking for a job for over a year is formation of a serious gap between the still useful skills (decreasing of skills is linked to the lack of professional activities) and the know-how required by enterprises. Undoubtedly structures must be mobilised/created to assist these groups in their re-qualification in the directions associated with the immediate needs of the new economic fabric. Certainly, there are such structures already present and they are developing, but at present it is not easy to find new arisen economic enterprises. .

 

Description of unemployment in rural zone

Quantitatively the number of jobseekers studied in the rural zones of Latvia gets around 26’700 people, that is 14% of recorded jobseekers on a national level in May 1997. The share of jobseekers in the economically active population is proportionally smaller I rural area - 7.5% compared to 19.4% in urban zone. This result, however, may need a more detailed analysis. It should be also taken in account that the definition of employed persons in rural areas includes the part of population that work in their own farms even if they are producing products for their own consumption only.

Three factors must be noted that underline the particular fragility of rural areas:

  • the share of jobseekers (7.5% in rural zone) does not stand by itself as an accurate indicator of the economic health. More or less definitive migrations of certain sections of the workforce hunting for a job in more dynamic regions contribute to the decrease of this share and to the correlative impoverishment of the human potential of abandoned territories;
  • the nature of social relations, the frequency of employment services and services of a more or less listing nature undoubtedly contribute to an underestimation of the job demand in rural zone. The very definition of jobseekers which implies simultaneously during the week of the survey a total absence of occupation, the assiduous hunting for a job and an immediate readiness for job seems not completely compatible with the enrolment of all the people engaged in temporary or seasonal activities.
  • in rural area, the women’s work is assessed with much greater difficulty in spite of its importance in little recognised as such. Women are essential in the running of the family farm and subsequently can not apply for the other sorts of job.

Breakdown of jobseekers among genders and age groups

The number of jobseekers is distributed more evenly among the genders (51% of men and 49% of women compared to 54% and 46% respectively in urban areas). The share of jobseekers in economically active population is slightly higher for women - 7.9% compared to 7.3% for men.

Fig.11. Breakdown of jobseekers according to age group in the rural zone

In spite of the crisis, which hits the country, the rural populations of those over fifty (often engaged in agricultural activities) are relatively spared. The small size of the farms drives the population to a food-producing agriculture but does not enable to employ younger ones and farm workers. The difficulty to restructure the enterprises leads these two groups to other sorts of activities.

In fact two thirds of the jobseekers are men and women under forty. As in the rest of the national territory, young people under twenty-five represent a quarter of the jobseekers with still a high male predominance (over 60%). The twenty-five/forty years old are the main group with nearly 50%% of the total of jobseekers.

Fig.12. Share of jobseekers in all population and in economically active population. Breakdown by age groups.

At the age below 20 it is very difficult to find a job. Share of jobseekers becomes much lower after the age of 50. After the age of forty the number of jobseekers clearly decreases.

Quantitatively those over forty years old make up the third of the "rural unemployment", and their unemployment level decreases by half compared to that of the young. The high ratio of men (77%) among the fifty/sixty certainly corresponds to a population of underskilled farm workers whose family farm can not provide them with enough income. They constitute the most threatened rural group by the predictable restructuring of agricultural activities.

Employment and professional diploma in the rural areas

On the whole women looking for a job have a higher level of education than men do. It should be mentioned once more that it is common trend for state in total and is characteristic for all spheres. Two thirds of them come from the secondary schools like in city areas and 6% have benefited from higher education (that is twice as few as in city areas). The vocational training does not concern at all the female population.

 

It is quite evident from fig. 13 that in the rural area even more than in the cities it is much more difficult to find a job without a professional training. Breakdown of jobseekers by type of education and gender is given in fig.14.

 

 

Fig. 13. Role of professional training in rural zone - share of jobseekers by type of training.

Fig. 14. Breakdown of jobseekers by level of education in the rural zone

Just below a third of the rural jobseekers only have a basic education or lower and often it is not enough for competition in the labour market. This population with two thirds of males clearly needs an important upgrading and qualifying course especially the younger ones. But it is little problematically to upgrade persons with a low level of education. Nearly 4 male jobseekers in 10 are in this situation, which makes a quick redeployment hypothetical.

An unemployment indicator correlative to the diploma level…

This indicator brings into light the close connection between the education level and the ability to find (or find again) job particularly within the male population. Therefore the share of jobseekers in economically active population is less than 3% for the university graduates in relation to 21% for the population with only a level of basic education.

The differential men/women is particularly outstanding within the low-level groups. It is certainly accounted for less by "insertion facilities" given to women than by traditional behaviours noted in rural zone. With no job prospects in a restricted area, their low transport autonomy and their dependence on the family activity constrain them to drop out for good from the labour market. For this reason the unemployment level is seemingly lower.

Fig.15. Share of jobseekers in the economically active population by level of education in the rural zone

Inversely, most men with a low level of education have no other choice but to hunt for an activity with low chances of success. They now make up a quarter of the jobseeking population in rural zone.

Unemplyment and work experience in the rural zone

The diversity of activities in which the rural inhabitants have built their experience in clearly more restricted than in city areas. The agricultural predominance is high for men (56%) but also for women (26%).

Fig.16. The five principal sectors of working experience of female jobseekers in the rural zone87 % women in the chart

 

Fig. 17. Five principal sectors of work experience of the male jobseekers in rural zone; 88% male jobseekers in the chart

 

On the whole the difficulties to find an insertion on the job market are more important than in city zone. The decay of industry in certain rural areas combined with the decrease of agriculture sector has lead to additional difficulties for the rural population.

Thus, previous work experience for jobseekers is mainly in agriculture for men while it is in manufacturing for women. The latter could be explained by the collapse of the old-fashioned industrial production in the rural areas where the main workers were women.

If the importance of agricultural activities - agriculture always has had an important role in Latvian economy - is unsurprising, one most note the weight of industry in the activity of rural populations. Lots of jobseekers are certainly former business employees coming from industrialised city areas. Their coming back to the "land" can mainly be associated with Land reform and resumption of ownership on landed property.

The main activities (agriculture, industry, trade, and services) are common to men and women.

Jobseeking AND PREVIOUS professional activity

The fact that out of all jobseekers in rural areas more than a half (50.2%) have no previous professional experience is an evidence of the difficulty to find the first job.

However, among those who have a previous job experience, for 6 jobseekers out of 10 the experience is ten years or longer... The demographic features and the nature of activities characteristic for the rural area, confirm the finding on the city areas concerning the length of professional experience. The populations from agriculture origin, rather old, compose the heart of these jobseekers that have previous work experience. Their total redeployment seems more complex and more uncertain than upgrading of their know-how for a restructured and modernised agriculture.

 

The unemployed coming from a depressed industry could meet the same difficulties as the former workers of city areas. The deep changes of the production system impose on them a re-adaptation both cultural and functional. The organisation, the rhythms, the autonomy of workers are obstacles to the reinsertion of former industry workers.

Registration of jobseekers at State Employment Service

The low diversity of job offers, the reduced autonomy of jobseekers, their geographical isolation and the difficulties to get information incite most unemployed people to resort to State Employment service (35% of men and 37% of women). This habit generally goes with a reading of specialised ads (above all women 16% men 13%), with appeal to relatives, friends, acquaintances (men 15% women 13%) and direct contacts with enterprises (men 25% and women 14%)). The share of business creations, still very small, is far more important than in city areas and mainly concerns the male population. Women who resent making spontaneous applications aspect almost everything from the state services.

Duration of jobseeking

The lengths of unemployment are almost identical to those of city areas and show the importance and the brutality of the crisis undergone by the country for a few years.

The break with the former system first hit the industrial activities where the male workforce prevails which leads to longer periods of unemployment.

Contrary to the difficulties met by other countries where unemployment is gradually spreading depending on the prevailing activities, the break here is more like an earthquake, which run through the whole country. This is confirmed by the analysis of the causes of the less of the last job: in three cases out of four, it is redundancy for economic reasons for men as for women.