70 million more lats needed if unemployment rises

RIGA- The Welfare Ministry of Latvia has announced that should the unemployment levels reach 12.7 percent this year, an extra 70 million lats will be required to pay unemployment benefits.

Economy Ministry experts say that unemployment may top out this year at 13.6 percent.

According to the Ministry's report, as there is less demand in the region, businesses will conduct staff cuts, while pointing out that many are instead introducing wage cuts as opposed to lay offs.

The Economy Ministry also warned of possible foray into illegal business dealings.

Specialists are also lacking in Latvia as the "brain drain" phenomenon includes trained specialists leaving the country for higher wages and better opportunities.

Currently the unemployment rate is holding at 10.7 percent according to the State Employment Agency. Director Baiba Pasevica reported that currently 116,768 people are registered as unemployed. The worst affected areas are the regions outside Riga, namely Rezekne, Dobele and Jekapils.