Employment Service: Labor markets in Europe are waking up from stagnation

In April, the European labor market barometer showed improving prospects for the third time in a row. The main indicator of the network of state employment services and the Employment Research Institute (IAB) increased by 0.2 points and reached 100.5.

The Lithuanian labor market forecasts for the next three months remain better than the European average. Although the barometer in our country increased slightly in April (0.1 points to 103.0), the situation is assessed positively.

“The European economy is struggling to emerge from a period of stagnation. The mood in the labor markets is gradually improving,” explained Enzo Weber, IAB’s head of forecasting.

Both components of the European labor market barometer increased this month. Conditions for the increase in employment remain favorable and do not change significantly (+0.1 points to reach 101.8). Although in Lithuania this indicator decreased by 1.4 points in April, it exceeded the average – 103.0.

The unemployment component in Europe came even closer to the neutral limit, increasing by 0.4 points and reaching 99.3. In Lithuania, the situation is even better – this barometer indicator increased by 1.6 points in April and further strengthened its position in the positive zone (103.0).

The European Labor Market Barometer is a key monthly indicator based on a survey of 17 local or regional public employment services. Since June 2018, the survey has been jointly conducted by the employment services and the Employment Research Institute.

The A component of the barometer shows the evolution of the unemployment rate over the next three months, taking into account seasonality. Meanwhile, component B predicts employment trends. The average of the unemployment and employment components forms the overall value of the barometer, and the latter provides a perspective on the development of the labor market.

The barometer scale ranges from 90 (very poor situation in the labor market) to 110 (very good situation). First, the barometer score of each employment service participating in the project is determined. The European labor market barometer is then calculated based on the weighted average of the national scores.

European labor market barometer data for different periods are presented here.