Statistics Estonia analyst Tea Vassiljeva explained that the unemployment rate (7.5 percent), which shows the share of the labor force that is unemployed, was only 0.1 percentage points lower last year than the year before. The average number of unemployed people in 2025 was 56,200, which is 900 fewer than in 2024.

Unemployment growing fastest among young men

Unemployment fell among women but increased among men. While the unemployment rate among women was 7.5 percent in 2024, it had declined to 6.6 percent in 2025. Over the same period, male unemployment rose by 0.7 percentage points, reaching an average of 8.3 percent in 2025.

"Unemployment increased the most last year among young men aged 15–24, which also led to an overall rise in youth unemployment," the analyst said.

The average youth unemployment rate (20.7 percent) was 1.6 percentage points higher than in 2024. The unemployment rate among young men was 22.5 percent — 3.6 percentage points higher than the year before.

The unemployment rate among young women (18.8 percent) was 0.5 percentage points lower than a year earlier.

The analyst explained that in other age groups, unemployment indicators remained largely stable or declined compared with the previous year.

"The unemployment rate among those aged 50–74 (5.7 percent) was the same as the year before. The unemployment rate among those aged 25–49 (6.7 percent) was 0.4 percentage points lower than a year earlier. However, we see the same trend in these groups as well — rising unemployment among men and declining unemployment among women," Vassiljeva said.

Unemployed increasingly feel they cannot cope

The number of people who had been unemployed for a short period — less than six months — declined, while the number of those unemployed for six to 11 months increased somewhat. The number of people who had been unemployed for a year or longer remained stable.

"Among the unemployed, it stands out that over the past couple of years, self-assessed coping ability has steadily declined — whereas in 2022 about one in four unemployed people (25.2 percent) said they were not or rather not coping financially, by 2025 nearly one-third (31.7 percent) felt the same," Vassiljeva noted.

In parallel with unemployment, employment also declined. The average number of employed people in 2025 was 693,100, which is 5,500 fewer than the year before. The employment rate (68.5 percent) was 0.4 percentage points lower than in 2024, with the decline evenly distributed among both men and women.

According to Vassiljeva, there were several differences by age group and gender. Among young people aged 15–24, the employment rate for women fell to 34.3 percent, 3.1 percentage points lower than a year earlier. Employment among young men remained relatively stable.

"Among those aged 25–49, we saw a 1.2 percentage point decline in the male employment rate, which stood at 87.2 percent in 2025," Vassiljeva highlighted. "At the same time, the same indicator for women was 84.1 percent, 1.1 percentage points higher than the year before last," she added.

Among those aged 50–74, reduced participation in employment was observed among women last year.

By sector, the largest declines in absolute employment figures in 2025 were recorded in manufacturing, education and construction.

At the same time, employment increased in transportation and storage, administrative and support service activities, healthcare and social work and accommodation and food service activities.

Regionally, the number of employed people decreased in Valga County, Viljandi County and Põlva County, as well as in Lääne County.

Employment increased in Harju County outside Tallinn, as well as in Rapla County, Lääne-Viru County and Pärnu County.

Labor force in shorter supply

The labor force participation rate, which reflects the level of activity among the working-age population in the labor market, stood at 74.1 percent in 2025, down 0.5 percentage points compared with 2024.

The share of economically inactive people increased by the same margin. "This means that in 2025, in addition to a decline in the working-age population, we also saw a further reduction in the labor force," Vassiljeva noted.

The decline in the labor force was driven by women, whose participation rate fell and whose economic inactivity rose by 1.1 percentage points compared with the previous year. At the same time, the male labor force participation rate increased by 0.2 percentage points over the year.

"While the employment rate declined evenly among both men and women, men remained active in the labor market and tended to move into unemployment, whereas women moved into economic inactivity," the analyst said.

Labor market indicators for the fourth quarter of 2025 followed a trend similar to the annual changes: the quarterly unemployment rate of 6.4 percent was 1 percentage point lower than in the fourth quarter of 2024. The employment rate (68.1 percent) was 0.4 percentage points lower than in the fourth quarter a year earlier and the labor force participation rate (72.7 percent) was 1.3 percentage points lower than a year before.

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