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European Centre of Expertise (ECE) in the field of labour law, employment and labour market policies

Labour market policy thematic review 2019 : skills imbalances : Estonia

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The current report provides a general overview of the state of play on skills imbalances in Estonia. The analysis relies on the sectoral reports as well as discussion papers published by OSKA and the results of the Occupational Barometer by the Unemployment Insurance Fund – the two central mechanisms providing a short- and long-term outlook on the skills imbalances in Estonia. This is complemented by the recent research evidence on the Estonian system of tackling skills imbalances and interviews. Estonia is currently in a very positive labour market situation, with the employment rate and labour market participation rate achieving the highest levels since the last peak in 2007. This is accompanied by a very low unemployment rate, indicating that a large part of the available labour force is occupied in the labour market and it is difficult for employers to find additional labour force. As a result, Estonian companies have one of the highest shares of reported difficulties in finding staff with the required skills. Indeed, in some growth areas, it is difficult to recruit new employees with the necessary skills (e.g. in ICT). At the same time, there are many sectors, where skills shortages are apparent, i.e. there is sufficient labour force with the necessary skills, while the employment conditions or the attractiveness of the job (e.g. low pay levels, shift work, physically demanding work etc) lead to the lack of labour force. The main highlights of the current report are the following:  Estonia has a good system of analysing and forecasting skills imbalances in the short as well as long term. This system is sustainable with a new conceptual framework being presented to the government for discussion in autumn 2019.  Available evidence allows for the analysis of skills shortages and surpluses by sector, occupation and educational level as well as by region (the latter in case of short-term forecast). Qualitative input enables for a more detailed analysis of the skills composition required in the future labour market.  One of the strengths of the Estonian skills forecast system is that it relies largely on the involvement of relevant stakeholders in various steps of the process, including defining the research focus in different sectors, discussing and interpreting results as well as monitoring the implementation of conclusions and recommendations.  Despite good evidence on skills imbalances, some challenges remain consistent across the sectors, including the popularity of certain fields of education and occupations particularly in vocational education, poor attractiveness of working conditions in some occupations, high dropout rate from the education system, the need for more practical training and stronger involvement of employers in the training process. These challenges need to be analysed in more detail and tackled with relevant policy responses. In case of the Estonian Lifelong Learning strategy, the programme of ensuring a better match between education and the world of work needs to be more comprehensive and organised, setting clear aims with sufficient policy measures to match these aims (Haaristo et al. 2019).
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ISBN 978-92-76-25119-4
DOI 10.2767/937882
Katalogo numeris KE-01-20-691-EN-N
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ISSN ISBN 978-92-76-25119-4 DOI 10.2767/937882 Katalogo numeris KE-01-20-691-EN-N
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