Socio-economic problems and disparities of the Latvian labor market

Socio-economic problems and disparities of the Latvian labor market

Tsaurkubule Zh.L.

Dr. Sci. (Engin,) Associate Prof., Baltic International Academy, Riga, Latvia

Mahmudova Ju.A.

Mg. (Econ.), Baltic International Academy, Riga, Latvia

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Tsaurkubule Zh.L., Mahmudova Ju.A. Socio-economic problems and disparities of the Latvian labor market. Sotsiologicheskie issledovaniya [Sociological Studies]. 2017. No 10. P. 133-140


In the article main tendencies of the Latvian labor market development in 2008 to 2014 are investigated with identification of contradictions in its development in the conditions of the European integration. The objective of the survey is to study and analyze issues of labor market performance in Latvia in the conditions of its EU membership as well as to development recommendations on its improvement and regulation. Main trends and statistics of labor demand and supply structures of the Latvian labor market across different professions/spheres are analyzed. Its main contradictions are investigated by means of the Beveridge curve and labor market tension coefficients. Primary conclusion is that the main reason for current trends and contradictions in the Latvia labor market lies in the relatively low level of economic development of the country compared to more developed EU countries. The survey confirmed existence of a positive correlation between the development of the labor market (in terms of the labor demand) and the level of economic development of the country. A conclusion is drawn on the existence of disparities between the professional structure of labor demand and labor supply in the national economy. In Latvia today level of hidden unemployment remains high and the regional differentiation of unemployment is considerable. The labor force is characterized by high mobility due to problems with employment and wages, as well as the low level of socio-economic development of Latvia. Аnalysis of the main tendencies in the development of the labor market allows for a conclusion that the employment policy in Latvia does not correspond to the priority directions of economic policy of the EU in the field of employment, therefore the majority of measures for accelerated of the human resources development included in the development programs of Latvia do not bring desirable results. Following the vector set by external circumstances (and, first of all, by the EU guidelines, member of which is Latvia), will lead to yet greater disbalance of the Latvian economy, and, first of all, to deformation of its labor market, because of the loss of human resources and to yet greater load on its social system. To overcome the negative phenomena in the employment sphere, a set of measures for forecasting the general needs of the state in the workplaces is proposed using of systemic approach. The set of measures is also proposed to improve the employment policies for economically active population and regional policy of labor distribution, carrying out the balanced investment and tax policy, and also growth of enterprise activity of small and medium-size business as the basis for the well-being of Latvia inhabitants.

Latvia; labor market; disparities; Beveridge curve; tension coefficients


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Content No 10, 2017