Insurance expected to add to unemployed

  • 2003-03-13

Estonia's unemployment rate may grow in spring due to the unemployment insurance system implemented from this year, specialists have said.

Mati Ilisson, director general of the Labor Market Board, told the Eesti Paevaleht daily that the number of redundancies may increase since the unemployment insurance effective from the start of the year guarantees workers allowances in case of loss of job, collective redundancy and employer's insolvency.

Maige Proom, spokeswoman for the unemployment fund, said it could not be ruled out that in March and April more unemployment allowance applications would be filed with the fund.

In January the fund received 1,314 allowance applications, but only 781 applications were lodged in February.

Economist Heido Vitsur, who is an adviser at the Ministry of Economy and Communications, said the present rate of unemployment was normal.

"In the construction sector there's less work because of the cold, and the fisheries are at a standstill altogether," he said.

"In April and May the situation will obviously begin to improve, unless something terrible happens in the world."

Compared with the last couple of years, the unemployment level is fairly low, as instead of the earlier average rate of 14 percent only 11.3 percent unemployment was recorded at the end of last year, Vitsur said.

"The situation was extraordinarily favorable last summer when unemployment fell below 10 percent in two quarters," he said. "Nevertheless, the lasting standstill in Europe and slow economic development in our neighboring economy is also likely to affect Estonia."