TALLINN - With eurozone entry behind it, Estonia is facing the daunting task of tackling double-digit unemployment, a top public concern as an election looms, reports AFP. As of mid-February, the official jobless rolls in this former ‘Tiger’ economy of 1.3 million people stood at 67,000, or 10.4 percent, but since not all of those out of work register, experts put the real total at over 100,000.
“Unemployment is the main issue concerning people at the moment,” said Andrus Saar, who heads a polling firm, noting that it could come into play in the country’s March 6 general election. The European Union’s polling arm, Eurobarometer, recently found that joblessness was a concern for 61 percent of those surveyed in Estonia.
Estonia, which joined the EU in 2004, switched its national currency the kroon on Jan. 1 to become the eurozone’s 17th member and the third from the ex-communist bloc. The change came as the Baltic nation emerges from a biting slump that sparked an austerity drive by its already fiscally-conservative government, in power since April 2005.
After an eight-year boom turned to bust in 2008, joblessness jumped from a 16-year low of 4.0 percent to 19.8 percent in early 2010, the highest rate since independence from Moscow in 1991. It then gradually dipped, in part thanks to economic green shoots but also because thousands simply gave up job-hunting, according to official data.
In another sign of the stubborn nature of the problem, 46,000 of the jobless have been out of work for at least a year, and nearly half of those for over two years. Katrin, 32, lost her civil service job in 2009 and says she struggles to get by on social security. “I get less than 70 euros a month and I’ve lost hope,” she said. In contrast, the average salary in Estonia is just over 800 euros and the minimum wage, 278 euros.
“People like me feel abandoned by the government. I feel very irritated when world leaders praise Estonia for handling the crisis so well, when the outcome of that policy is 100,000 desperate people like me,” added Katrin.
The situation can be tough for those who get back to work, too. Ljubov Jegorova, 57, has just found a part-time job as a cook in a Tallinn children’s play center and makes 192 euros a month. She was fired in 2009 after 30 years in the kitchen of a local kindergarten. “It was very hard; at my age it’s almost impossible to find a new job in Estonia,” said Jegorova, who moved with her 19-year-old daughter to a room in a homeless hostel.
“My job will end when the place I work in is closed for the summer, and whether I’ll get it back in autumn, and how I’ll manage in the summer, I don’t know,” she said.
People like Jegorova and Katrin say they feel they were sacrificed as the government took a hard line on the economy to ensure euro entry. The government rejects this opinion. “The claim that high unemployment is directly related to the cuts made for the sake of the euro is not correct,” says Economy Minister Juhan Parts. “Unemployment increased during the recession mostly in sectors that had developed rapidly during the boom years, like construction, and by now the rate of employment in these sectors is back at normal, pre-boom levels,” Parts said.
“We could have slowed down unemployment using more state finances, but in the longer term the structural changes were good for the economy,” he added, noting that it had helped stem boom-time salary rises that dented competitiveness.
Unlike many other European nations, where rocketing unemployment fuelled protests, Estonians have barely taken to the streets. “Civil society in Estonia, which returned to the market economy less than 20 years ago, is still very weak,” said Harri Taliga, chairman of the country’s trade union confederation. “Many people in Estonia have treated the rapid rise in unemployment like a natural catastrophe over which one has no control, but [believe] the government can - and should - do more,” he said.