1 / 40

ANALYSIS OF LITHUANIAN LABOUR MARKET

ANALYSIS OF LITHUANIAN LABOUR MARKET. Jurate Jovaisiene. Slide Master. Your Text here

pierce
Download Presentation

ANALYSIS OF LITHUANIAN LABOUR MARKET

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. ANALYSIS OF LITHUANIAN LABOUR MARKET Jurate Jovaisiene LdV project meeting, Lappeenranta, March 2012

  2. Slide Master • Your Text here • Lorem ipsum dolor sit amet, consectetuer adip iscing elit, sed diam no n u mmy nibh euismod tincidunt ut laoreet do lore magna aliquam er at v olut pat. Ut wisi enim ad mi ni m venia m, quis nostrud exerci tatio n ulla mco rper susc ip it lobor tis nisl ut aliquip ex ea commodo cons equat. • Duis autem vel eum iriure dolor in hendrerit in vulputate velit esse mo les tie consequat, vel illum dolore eu feugiat nulla fac ilisis at vero eros et ac cumsan et iusto odio dign issim qui bla ndit praesent lup tatum zzril dele nit augue duis dolore te fe ug ait nulla facilisi LdV project meeting, Lappeenranta, March 2012

  3. UNEMPLOYMENT RATE • Unemployment rate in Lithuania (in the end of 2011) - 14,3%; • Unemployment rate down from the peak of 17.8% reached in 2010; • Unemployment in 2011, however, still remained at its highest level since 2001. LdV project meeting, Lappeenranta, March 2012

  4. EMPLOYMENT RATE (1) • The ratio of employed in the age group of 15-64 year olds to total population in this age group has been the lowest in Lithuania of the three Baltic states. • During the first nine months of 2011, this ratio bounced back to 60.4% from 57.8% in 2010. • However, it was lower than the EU average of 64.3%. LdV project meeting, Lappeenranta, March 2012

  5. EMPLOYMENT RATE (2) LdV project meeting, Lappeenranta, March 2012

  6. CONSEQUENCES OF CRISIS (1) • From 2008 until 2010, when the unemployment rate increased from 5.8% to 17.8%, the number of employed in the construction, manufacturing, and wholesale sectors decreased the most - by more than 10%. • About 45% and 40% of all employed were in those three sectors in 2008 and 2010, respectively. LdV project meeting, Lappeenranta, March 2012

  7. CONSEQUENCES OF CRISIS (2) • Due to massive layoffs in the construction and manufacturing sectors, the unemployment rate of men, who tend to be employed in these sectors more than women, increased from 6.0% in 2008 to 21.2% in 2010. • Meanwhile, the unemployment rate of woman, which traditionally is less elastic, increased from 5.6% in 2008 to 14.4% in 2010. LdV project meeting, Lappeenranta, March 2012

  8. CONSEQUENCES OF CRISIS (2) • The most vulnerable have been low-skilled workers. • The unemployment rate among people with only a secondary education or lower than that amounted 30-42% in 2010. • This was much more than the unemployment rate among university graduates, which increased from 3.0% in 2008 to 7.0% in 2010. LdV project meeting, Lappeenranta, March 2012

  9. CONSEQUENCES OF CRISIS (3) LdV project meeting, Lappeenranta, March 2012

  10. YOUTH UNEMPLOYMENT RATE (1) • In Lithuania, in two years (from 2008 until 2010), the unemployment rate, as well as the youth (15-24-year olds) unemployment rate, increased much more than in the EU on average. • Even though the total unemployment rate in 2010 in Lithuania was lower than in Latvia, Lithuania's youth unemployment rate continued its rapid increase, reaching 35.1% - 14.2 percentage points more than the EU average and slightly above Latvia’s (34.5%). LdV project meeting, Lappeenranta, March 2012

  11. YOUTH UNEMPLOYMENT RATE (2) LdV project meeting, Lappeenranta, March 2012

  12. YOUTH UNEMPLOYMENT RATE (3) • The youth unemployment rate is highly correlated with the total unemployment rate, but is more volatile. • During an economic downturn, employers may choose from a wider variety of more experienced workers seeking jobs. • While, on the contrary, by employing a younger person, the employer most often has to invest in that person and take a risk that, after acquiring the skills and experience, the worker might quit and take a job in a competing firm. LdV project meeting, Lappeenranta, March 2012

  13. YOUTH UNEMPLOYMENT (1) • Therefore, during hard times, employers are less eager to take such risks. • The young people employed during recessions become more vulnerable as well, as employers choose to fire those with less experience and knowledge, and probably those whose severance pay is lower – in both cases, this will most likely be a younger person. LdV project meeting, Lappeenranta, March 2012

  14. YOUTH UNEMPLOYMENT (2) • Youth unemployment should be decreasing as total employment increases. • Nevertheless, it remains a significant problem for a country with high emigration rates. • A high youth unemployment rate can harm the future labour force as some may decide to leave the country, and others, without appropriate experience, will be less productive than otherwise. LdV project meeting, Lappeenranta, March 2012

  15. LABOUR FORCE ACTIVITY RATE (1) • However, sometimes the scope of youth unemployment in Lithuania can be somewhat exaggerated because the number of unemployed is not as high if the activity rate in taken into account. • The labour force activity rate among 15-64-year olds has been more than 70% recently, whereas the activity rate of youth barely reaches 30% – majority of them are still studying and for that reason are not active participants of the job market. LdV project meeting, Lappeenranta, March 2012

  16. LABOUR FORCE ACTIVITY RATE (2) • Therefore, if the ratio of unemployed to population of the respective age group is considered, then the youth unemployment is rather small – 9.7% and 7.6% in 2010 and 2011, respectively, which is considerably lower than the registered unemployment rate of the working-age (15-64-year olds) population (11.7%). LdV project meeting, Lappeenranta, March 2012

  17. LABOUR FORCE ACTIVITY RATE (3) LdV project meeting, Lappeenranta, March 2012

  18. YOUTH LABOUR FORCE ACTIVITY • Currently, 67% of those in the 15-24 age group are still studying in schools, colleges, universities, or other educational institutions. • Therefore, most of the active population in this age group have either few qualifications, or are looking only for a part-time job. • Not many employers are eager to employ unqualified workers, who may not be able to fully engage in work due to other responsibilities regarding education. LdV project meeting, Lappeenranta, March 2012

  19. LACK OF QUALIFICATIONS (1) • According to Lithuanian Labour Market Exchange, 59.3% of youth registered as unemployed did not have any professional education, whereas among all the unemployed the unqualified comprised only 41.9%. • Many of the unemployed under 25 years old used to work in construction sector (a choice made during booming years), but became unemployed when this sector collapsed. LdV project meeting, Lappeenranta, March 2012

  20. LACK OF QUALIFICATIONS (2) • This means that currently the biggest problem is related to insufficient qualifications of young people. • Their unemployment would ebb if construction sector were to recover rapidly and a lot of low-skilled jobs were created. • However, unless there is a fundamental shift in how renovation of soviet-era buildings is organizes, this is not likely to happen any time soon. LdV project meeting, Lappeenranta, March 2012

  21. LACK OF QUALIFICATIONS (3) • Another option is to rethink the way Labour Exchange organizes trainings of unskilled unemployed. • A system where companies are subsidized for training their potential future employees could significantly lower mismatch between skills supplied and demanded in the market. LdV project meeting, Lappeenranta, March 2012

  22. EDUCATIONAL PROBLEMS (1) • Another problem is less related to a business cycle and is more dangerous in a long term. • The fact that one third of registered unemployed have recently obtained qualifications but are unable to find a job indicates significant flaws in higher education system. LdV project meeting, Lappeenranta, March 2012

  23. EDUCATIONAL PROBLEMS (2) • Lithuania has too many universities and colleges which offer education in way too many programmes which provide little knowledge, skills and competences needed outside the doors of educational institution. • Obligatory internships, unfortunately, are usually sham and do not prepare young people for the job market. LdV project meeting, Lappeenranta, March 2012

  24. EDUCATIONAL PROBLEMS (3) • Even though Lithuania is one of the leading countries based on the number of students per 1,000 people, there appears to be a mismatch between supply and demand in the labour market. • Employers have trouble finding suitable employees even when the number of people looking for jobs rises. • Most of the unemployed do not have the necessary education or experience. LdV project meeting, Lappeenranta, March 2012

  25. EDUCATIONAL PROBLEMS (4) • According to the Lithuanian Labour Market Exchange, 22% of registered unemployed at the beginning of this year did not have any experience, and 41.9% did not even have any professional education. • Therefore, in some cases, the demand for labour was higher then the supply. LdV project meeting, Lappeenranta, March 2012

  26. GRADUATES OF JONISKELIS VOCATIONAL SCHOOL (1) • 105 students have been finished our school in 2011. • The school conducted a survey of graduates in the autumn of 2011. • We have been found out, that: • Are studying at universities and colleges – 6 persons; • Are studying at vocational schools – 19 persons; • Have a job in Lithuania – 57 persons; • Are working abroad – 14 persons; • Raise a child – 2 persons; • Unemployed – 7 persons. LdV project meeting, Lappeenranta, March 2012

  27. GRADUATES OF JONISKELIS VOCATIONAL SCHOOL (2) LdV project meeting, Lappeenranta, March 2012

  28. LONG-TERM UNEMPLOYMENT (1) • Long-term unemployment may become one of the obstacles to reducing unemployment to a more acceptable level in the future. • In addition to increasing the total unemployment rate, people who have stayed out of work for a year or longer may drop out of the active labour force as they lose hope of finding jobs. LdV project meeting, Lappeenranta, March 2012

  29. LONG-TERM UNEMPLOYMENT (2) • The long-term unemployed lose their skills, or those skills become outdated and irrelevant. • This makes it harder to find a job. As statistics show, this problem in Lithuania is becoming more severe. • The rate of increase in the long-term unemployed did not subside even in 2011, although the total unemployment rate eased to 15.4%. LdV project meeting, Lappeenranta, March 2012

  30. LONG-TERM UNEMPLOYMENT (3) • The number of long-term unemployed continued increasing as people who stayed out of job for a longer period of time failed to employ them selves. • Probably it was hard to find work even for those who lost their jobs about a year ago, and new people therefore became long-term unemployed as well. LdV project meeting, Lappeenranta, March 2012

  31. LONG-TERM UNEMPLOYMENT (4) • Such unemployed people, who are not likely to earn much more than their benefits, tend to become long-term unemployed. • In such cases, even if the unemployment trap is reduced and their motivation to find work returns, it may be hard for them to find jobs. LdV project meeting, Lappeenranta, March 2012

  32. LONG-TERM UNEMPLOYMENT (5) • The longer people remain unemployed, the harder it becomes to find a job, as they lose their skills or their competence becomes outdated and irrelevant. • Another possible negative consequence of a large unemployment trap is a decision to work unofficially and keep unemployment benefits. • This tendency was very pronounced in 2009 and 2010. LdV project meeting, Lappeenranta, March 2012

  33. LONG-TERM UNEMPLOYMENT (6) • People should also be less inclined to work unofficially, the smaller is the unemployment trap. • When the benefits are not much lower than the wages the unemployed could get, they may choose to stay unemployed and work for a few hours unofficially to increase their income somewhat. LdV project meeting, Lappeenranta, March 2012

  34. FOREIGNERS EMPLOYEES • During the last year, the Lithuanian Labour Market Exchange issued 3.3 thousands permits to employ foreigners—almost double the amount in 2010. • The foreigners were mostly employed by the services and industry sectors, answering the demand for truck drivers, assemblers of metal ships, and welders. LdV project meeting, Lappeenranta, March 2012

  35. REGISTRATION PROCEDURES (1) • EU citizen may arrive and stay in Lithuania not longer than 3 months per half a year, however, such EU citizen looking for a job or intending to carry out other legal activity in Lithuania, may stay additional 3 months in Lithuania. Family members of the EU citizen may arrive to Lithuania together with the EU citizen and stay for the same period. LdV project meeting, Lappeenranta, March 2012

  36. REGISTRATION PROCEDURES (2) • A foreign resident, who has been granted a temporary residence permit in the Republic of Lithuania, within seven days after his/her arrival to the Republic of Lithuania, must notify the migration authorities about the arrival. LdV project meeting, Lappeenranta, March 2012

  37. TEMPORARY RESIDENCE PERMIT If EU citizen is intending to: • start working or carry out other legal activity in Lithuania • stay in Lithuania longer than 3 months • study in Lithuania He (she) must apply to Migration authority for a temporary residence permit. LdV project meeting, Lappeenranta, March 2012

  38. EMPLOYMENT CONTRACT • Work permits are not required for EU citizens and their family members intending to work under the employment contract in Lithuania. • The employment contract must be concluded in writing according to a standard format. Written contracts are drawn up in duplicate. One of the signed copies is given to the employee, the other remains with the employer. The employer is responsible for the proper conclusion of the employment contract. LdV project meeting, Lappeenranta, March 2012

  39. USED SOURCES • “Swedbank Analysis, March 2, 2012” by Vaida Seskute and Nerijus Maciulis. • Presentation “Living and working conditions in Lithuania”, created by Sonata Marcinkeviciute, 2010. • Lithuanian labour market – www.ldb.lt. • Statistiscs Lithuania – www.stat.gov.lt. • Eurostat - http://epp.eurostat.ec.europa.eu. LdV project meeting, Lappeenranta, March 2012

  40. THANK YOU FOR YOUR ATTENTION! LdV project meeting, Lappeenranta, March 2012

More Related