The registered unemployment rate increased by 1pp m/m to 8.7% in December, according to data of the Labor Exchange provided on Monday. On an annual basis, the jobless rate increased by 0.2pps, with the actual number of registered jobless people rising by 500 y/y. The annual increase in the registered unemployed and the registered jobless rate during a year of strong economic growth highlights Lithuania’s structural labor market problems. To add to that, although vacancies in December declined on monthly and annual basis, the figure remains quite elevated at 18,200. Last but not least, we remind that the quarterly labor force survey data showed that the labor force declined by 1.5% y/y in Q3 and the number of employed went down by 0.4% y/y while projections show that employment will continue to decline in 2018-2019.
Overall, the registered labor market data was rather expected given that with the end of summer seasonal hiring, the registered jobless rate increases in Q4-Q1 each year. The rate will thus increase further in the following months although at a less pronounced rate compared to December.