"Latvia's labor market under pressure" says Swedbank

Take note – story published 4 years ago

A new piece of economic research by Swedbank suggests the frequently-predicted scenario of labor and skills shortages putting a brake on the Latvian economy is getting closer to reality.

"The ongoing economic expansion has brought unemployment rate considerably down and further decreases will be more challenging," Swedbank says in its summary of the data, while warning that "Increasing labor shortages suggest the economy is close to its full employment."

That being the case, the pressure for wages to increase rapidly will increase as employers fight over a limited pool of talent and muscle available in the workforce. That in turn could impact productivity and competitiveness, which in turn would have a knock-on effect on Latvia's exporting potential, an area that has been experiencing very positive trends recently.

"There is still some slack in the labor market that can be unlocked by promoting mobility and training, changes to the way companies organize work," advises Swedbank.

The full 12-page research featuring plenty of data can be read online.

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