Labour market information

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Cyprus - National Level

Short overview of the labour market

 

In addition to disrupting the lives of individuals, families and communities and the ongoing health threat, the COVID-19 pandemic also had a major impact on businesses and the economy of Cyprus as a whole in 2020. In 2020, the Cypriot economy (like all European economies) shrank by 5.3%, negatively affecting the very good performance recorded in 2018 and 2019 and the recovery expected after the 2013-16 economic crisis.

 

Thus far (to March 2021) one can say that the general rate of unemployment in Cyprus has remained low. It has risen to 7.9%, from 6.8% in March 2020. The one per cent increase is currently considered to be a small negative development, since a large number of employers did not engage in large-scale redundancies. This is because the subsidy schemes put in place since March 2020 for businesses, due to the impact of the pandemic, are conditional on staff not being laid off.

 

The mobility of employees in Cyprus in general (whether incoming or outgoing) has suffered a serious blow since most of the economic sectors in Cyprus which usually recruit staff from the EU on a seasonal basis have been severely affected by the pandemic (tourism, catering, leisure and construction). In addition, people continue to be reluctant and fearful of moving to another country for employment. The different situations in Member States as far as public health and the pandemic are concerned makes it even harder to decide on such a move. Closed borders and strict controls are also aggravating the situation for people seeking work beyond their own borders.

 

Lastly, market uncertainty and the unknowns surrounding when there will be return to normality has led many employers in many economic sectors to stop recruiting new staff, attempting to retain existing staff in their businesses (using state subsidies) and focusing more on the local labour market to meet any increased needs they might face. The same downward trend can be seen in the number of vacant posts we manage as a network in Cyprus.

 

Unfortunately, in 2021, in economic sectors where it was easy to recruit seasonal workers via the EURES network (tourism, catering, construction, leisure, etc.), the number of vacant posts available on the EURES portal today is considerably lower than in other years.

 

Based on the latest preliminary data available from Eurostat, the statistical office of the European Union, in February 2021, unemployment in Cyprus stood at 7.3%, representing a 1.1% increase compared to the same month last year.

 

The average unemployment rate in 2018 stood at 8.4%, compared to 11.1% in 2017, 12.9% in 2016, 14.9% in 2015, 16.1% in 2014 and 15.9% in 2013.

 

According to the data held at the District Labour Offices, there were 32 333 registered unemployed persons in late February 2021. Compared to January 2020, this was an increase of 6 119 people or 23.3%.

 

The unemployment rate for young people aged 15-24 stood at 20.4% in the third quarter of 2020, up some 3.6 percentage points (1 634 people) compared to the third quarter of 2019, when the figure was 16.8% (5 489 people).

 

The level of employment (15+) in the third quarter of 2020 dropped by 2 198 people compared to the same quarter in 2019, and stood at 414 920 people compared to 417 118 in 2019. During the same period, i.e. in the third quarter of 2020, the employment rate for 20-64 year-olds stood at 74.5% compared to 75.7% in the same period in 2019, reflecting a drop of 1%.

 

The highest concentration of unemployed people has been recorded in the hotel sector (7 496 people or 23% of the total), trade (6 035 people or 19%) and other services (5 645 people or 17% of the total).

 

The highest concentration of unemployed people was recorded in the 30-39 age group (8 779 people or 27% of the total) and in the 40-49 age group (6 753 people or 21% of all persons registered as unemployed with the Public Employment Service (PES)).

 

Greek Cypriots made up the majority of the unemployed population, with 21 184 persons (66%). Of the total unemployed population, 6 853 persons (21%) were European citizens.

 

Of those registered as unemployed, 14 610 persons (45%) have a general or technical secondary education, 10 024 (31%) are tertiary education graduates, 7 466 (23%) have a primary education and 233 (1%) have no formal education.

 

Text last edited on: 05/2021