Less than half the people cope well in economic terms

According to Statistics Estonia, in the 4th quarter of 2009 less than half of the population in age group 15–74 coped well in economic terms, two years earlier the respective figure was 60%.

Last year and the current year have been quite complicated for Estonia. The conjuncture in economy and on the labour market has worsened rapidly and this has significantly influenced the economic coping of many people.

Individual estimation about economic coping is important to evaluate poverty risks and define the potential groups who need assistance. According to the data of the Labour Force Survey, in the 4th quarter of 2007, 60% of the population in age group 15–74 coped well. 31% coped with some difficulties and 9% coped with great difficulties. For the 4th quarter of 2009 the number of persons coping well had decreased to less than half (to 48%). 37% of persons coped with some difficulties and 15% with great difficulties.

Unemployed and long term unemployed persons (the persons who have been seeking for a job 12 months or longer) are among those who have the biggest risks of not coping. In the 4th quarter of 2009, the percentage of long term unemployed persons among the unemployed increased significantly. Difficulties in finding a new job have entailed more interest in jobs not typical of Estonia. The small number of fixed term jobs is typical of Estonia and this has not changed during the economic recession either. At the same time the number of unemployed persons ready to accept fixed term jobs has increased significantly.

In the 4th quarter of 2007, 57% of unemployed persons looked for a permanent job. 39% of the unemployed persons looking for a permanent job would have accepted also a fixed term job. In the 4th quarter of 2009, 32% of the unemployed looked for a permanent job only and 63% would have accepted also a fixed term job. It also indicates to the fact that the economic situation of many households has become so difficult that people are willing to accept any job to improve the household’s economic situation. The rapid growth of persons who have problems with coping, difficulties of the unemployed persons in returning to the labour market and a substantial decrease of their income predict the growth of inequality and stratification in the society.

Different persons assess their own coping from different initial standpoints which depend, for instance, on previous consumption habits, on the comparison of their own opportunities against those of friends and acquaintances, etc. Own evaluation of coping also reflects the general feeling of confidence and sufficiency of resources necessary for everyday life, thus serving in a sense as a subjective estimation of poverty.

A more detailed analysis could be read in the publication “Vaesus Eestis. Poverty in Estonia”, published today, on February 26th by Statistics Estonia (http://www.stat.ee/38022).

Source: Statistics Estonia

Exports to Finland and Sweden decreased the most

According to Statistics Estonia, in 2009 the exports at current prices decreased 24% and imports 33% compared to 2008. Exports to Finland and Sweden decreased most by the trade value. In the last months of the year the decline in the trade slowed down.

In 2009 the value of exports of goods from Estonia made up 101.3 billion kroons and imports to Estonia accounted for 114.1 billion kroons in current prices. Compared to 2008, the value of exports decreased by 31.1 billion kroons and imports by 56 billion kroons. The trade deficit was announced as 12.8 billion kroons, which was threefold smaller than in the previous year.

Estonia’s foreign trade, January–December, 2008–2009
Month Exports, mEEK Imports, mEEK Balance, mEEK
2008 2009 change,
%  
2008 2009 change,
%
2008 2009
Total 132 446 101 310 -24 170 042 114 083 -33 -37 596 -12 773
January 10 154 7 265 -28 13 725 8 800 -36 -3 571 -1 535
February 10 677 7 820 -27 13 641 8 727 -36 -2 964 -907
March 10 647 8 346 -22 14 145 9 746 -31 -3 498 -1 400
April 12 332 7 742 -37 15 916 9 291 -42 -3 584 -1 549
May 11 549 8 165 -29 14 507 8 472 -42 -2 958 -307
June 10 862 9 561 -12 14 140 9 907 -30 -3 278 -346
July 10 969 8 242 -25 15 047 9 389 -38 -4 078 -1 147
August 11 142 8 125 -27 13 420 9 263 -31 -2 278 -1 138
September 12 300 9 442 -23 15 195 10 133 -33 -2 895 -691
October 13 249 8 957 -32 15 656 9 728 -38 -2 407 -771
November 9 897 9 083 -8 12 929 10 390 -20 -3 032 -1 307
December 8 669 8 564 -1 11 724 10 237 -13 -3 055 -1 673

The main countries of destination were Finland (18% of Estonia’s total exports), Sweden (13%) and Latvia (10%). Exports declined to all countries of destination, the most to Finland and Sweden –—nearly by 5.6 billion kroons compared to 2008. The decline of exports to Finland and Sweden was mainly caused by the decrease of exports of electrical equipment and of wood and articles thereof.

The main countries of consignment were Finland (14% of Estonia’s total imports), Lithuania (11%), Germany and Latvia (10%, both countries).  Imports declined from all the main countries of consignment, the most from Germany (by 10.9 billion kroons), Finland and Sweden (by 7.5 billion kroons from both countries). From Germany and Sweden imports declined due to the decrease in imports of vehicles and parts thereof; from Finland due to the decrease in imports of machinery and equipment.

In 2009, in exports, among the commodity sections the first place was held by the section of machinery and equipment (a fifth of Estonia’s total exports), followed by mineral products (17%) and agricultural products and food preparations (10%). There was a significant decrease in exports of machinery and equipment (by 9 billion kroons) as well as metals and products thereof (7.1 billion kroons). Only exports of mineral products (incl. oil products) increased (by 1 billion kroons).

In 2009, in imports, the first place was held by machinery and equipment (a fifth of the total imports), followed by machinery and equipment (19%) and agricultural products and food preparations (13%). The turnover of imports declined among all the commodity sections, the most significantly in the imports of machinery and equipment (by 14.8 billion kroons) and of transport equipment (by 11.5 billion kroons).

The biggest trade deficit was mentioned in the trade of mineral products (6 billion kroons) and raw materials and products of chemical industry (5.2 billion kroons). The biggest surplus was mentioned in the trade of wood and products thereof (5.8 billion kroons).

In December 2009 the value of exports of goods was 8.6 billion kroons. Exports decreased 1% compared to December of 2008. The value of imports was 10.2 billion kroons, imports declined by 13% compared to December 2008. The decline in both exports and imports was mainly caused by the decrease in trade with machinery and equipment.

Read more here: Statistics Estonia

Recession has increased the risk to fall into poverty

According to Statistics Estonia, in the 4th quarter of 2009 less than half of the population in age group 15–74 coped well in economic terms, two years earlier the respective figure was 60%.

Last year and the current year have been quite complicated for Estonia. The conjuncture in economy and on the labour market has worsened rapidly and this has significantly influenced the economic coping of many people.

Individual estimation about economic coping is important to evaluate poverty risks and define the potential groups who need assistance. According to the data of the Labour Force Survey, in the 4th quarter of 2007, 60% of the population in age group 15–74 coped well. 31% coped with some difficulties and 9% coped with great difficulties. For the 4th quarter of 2009 the number of persons coping well had decreased to less than half (to 48%). 37% of persons coped with some difficulties and 15% with great difficulties.

Unemployed and long term unemployed persons (the persons who have been seeking for a job 12 months or longer) are among those who have the biggest risks of not coping. In the 4th quarter of 2009, the percentage of long term unemployed persons among the unemployed increased significantly. Difficulties in finding a new job have entailed more interest in jobs not typical of Estonia. The small number of fixed term jobs is typical of Estonia and this has not changed during the economic recession either. At the same time the number of unemployed persons ready to accept fixed term jobs has increased significantly.

In the 4th quarter of 2007, 57% of unemployed persons looked for a permanent job. 39% of the unemployed persons looking for a permanent job would have accepted also a fixed term job. In the 4th quarter of 2009, 32% of the unemployed looked for a permanent job only and 63% would have accepted also a fixed term job. It also indicates to the fact that the economic situation of many households has become so difficult that people are willing to accept any job to improve the household’s economic situation. The rapid growth of persons who have problems with coping, difficulties of the unemployed persons in returning to the labour market and a substantial decrease of their income predict the growth of inequality and stratification in the society.

Different persons assess their own coping from different initial standpoints which depend, for instance, on previous consumption habits, on the comparison of their own opportunities against those of friends and acquaintances, etc. Own evaluation of coping also reflects the general feeling of confidence and sufficiency of resources necessary for everyday life, thus serving in a sense as a subjective estimation of poverty.

A more detailed analysis could be read in the publication “Vaesus Eestis. Poverty in Estonia”, published today, on February 26th by Statistics Estonia (http://www.stat.ee/38022).

Source: Statistics Estonia

The employer’s average monthly labour cost is 16,730 kroons

According to Statistics Estonia, in the 4th quarter of 2009, the average monthly gross wages and salaries were 12,259 kroons (1 EUR= 15.64660 EEK) and the hourly gross wages and salaries were 74.25 kroons. Compared to the 4th quarter of 2008, the average monthly gross wages and salaries were by 6.5% lower and the average hourly gross wages and salaries were by 6.7% lower.

The average monthly gross wages and salaries decreased for the fourth quarter in succession at an accelerating pace compared to the same quarter of the previous year. In the 1st quarter of 2009 the decrease was 1.5%, in the 2nd quarter — 4.4% and in the 3rd quarter — 5.9%.

The real wages which took into account the influence of the change in the consumer price index decreased 4.6% in the 4th quarter. In the 1st, 2nd and 3rd quarter of 2009 real wages decreased by 4.5%, 4.1% and 4.9%, respectively. As of the end of December, the number of employees decreased 10.5% compared to the same period of 2008.

Compared to the 4th quarter of 2008, the average monthly gross wages and salaries increased only in two economic activities — in electricity, gas, steam and air conditioning supply (2.9%) and in real estate activities (1.7%). The monthly gross wages and salaries decreased the most in public administration and defence; compulsory social security activity (15.9%).

Compared to the 4th quarter of 2008, the average hourly gross wages and salaries increased also only in two economic activities — in real estate activities (6.6%) and in electricity, gas, steam and air conditioning supply (2.1%). The average hourly gross wages and salaries decreased the most in construction (13.8%).

The average gross wages and salaries were 12,226 kroons in October, 11,891 kroons in November and 12,662 kroons in December.

In the 4th quarter of 2009, the employer’s average monthly labour costs per employee were 16,730 kroons and the average hourly labour costs were 109,05 kroons. Compared to the 4th quarter of 2008, the average monthly labour costs per employee and the average hourly labour costs decreased 5.9% and 6.7%, respectively.

Compared to the 4th quarter of 2008, the average monthly labour costs per employee increased only in two economic activities — in electricity, gas, steam and air conditioning supply (5.1%) and in real estate activities (2.6%) and decreased the most in public administration and defence; compulsory social security activity (14.6%).

Compared to the 4th quarter of 2008, the average hourly labour costs increased only in two economic activities — in real estate activities (5.1%) and in electricity, gas, steam and air conditioning supply (3.5%) and decreased the most in public administration and defence; compulsory social security activity (13.9%).

Statistics Estonia conducts the survey of wages and salaries statistics on the basis of international methodology since 1992. In 2009, the sample includes 11,263 enterprises, institutions and organisations. The average monthly gross wages and salaries have been given in full time units to enable a comparison of different wages and salaries, irrespective of the length of working time. Calculations of the monthly gross wages and salaries are based on

payments for actually worked time and remuneration for time not worked. The hourly gross wages and salaries do not include remuneration for time not worked (holiday leave pay, benefits, etc.). In short term statistics, the average gross wages and salaries are measured as a component of labour costs. Labour costs include gross wages and salaries, employer’s contributions and employer’s imputed social contributions to employees.

Average monthly gross wages and salaries, 1st quarter 2005 – 4th quarter 2009 (kroons)
  Year 1st quarter 2nd quarter 3rd quarter 4th quarter
2005 8 073 7 427 8 291 7 786 8 690
2006 9 407 8 591 9 531 9 068 10 212
2007 11 336 10 322 11 549 10 899 12 270
2008 12 912 12 337 13 306 12 512 13 117
2009   12 147 12 716 11 770 12 259

Average monthly gross wages and salaries and monthly labour costs per employee, 4th quarter 2009

Diagram: Average monthly gross wages and salaries and monthly labour costs per employee, 4th quarter 2009

Average hourly gross wages and salaries and hourly labour costs, 4th quarter 2009

Diagram: Average hourly gross wages and salaries and hourly labour costs, 4th quarter 2009

(1 EUR= 15.64660 EEK)

Source: Statistics Estonia

Small business to get an electric shock

Many Estonian small manufacturers were surprised to learn that they must pay over 50% more for electricity from April 1 when Estonia partly liberalises its electricity market. The new rule applies on consumers that are connected to the networks of so-called free market suppliers, writes Äripäev.

This has come as a major shock since until now only large electricity consumers were said to be subject to the new system where they must buy electricity from the open market.

However, since the consumption of large enterprises is not sufficient to ensure that Estonia liberalised at least 35% of its electricity market from April, as agreed when Estonia joined the EU, the Estonian parliament adopted a bill that extended the scope of the new system so that 299 connection points all over Estonia are required to buy electricity from the open market. This means that all sub-consumers connected to this network will see their electricity costs go up sharply.

Read more from BBN

Lithuania had first deflation since 2004

In January consumer prices declined 0.3% y/y in Lithuania, heralding deflation for the first time since spring 2004, as the food price decrease hit a new high of 5%. Lithuania has thus become the last of the three Baltic countries to enter the annual deflation zone.  The deflation rate could have been higher if not for a 26% annual jump in electricity prices, a factor that is bound to add an extra 1.1-1.4 percentage point to the annual consumer price index.  Analysts expect the annual average consumer price change to be in the 0% to +2% range this year.

Source: BBN

Italian carrier to start flights to Italy in summer

The Italian airline Wind Jet will on 9 June launch a summer service between the Estonian capital Tallinn and Forli in northern Italy, Tallinn Airport reports.
The Wind Jet network will open up broad opportunities to Estonian travellers for continued flights to Sicily, Tallinn Airport board member Erik Sakkov said.
The once-weekly flights will be taking place on Wednesdays. The 144-seat Airbus A319 will take off from Forli at 10 a.m. and land in Tallinn at 2 p.m. The plane will depart from Tallinn at 3 p.m. on the same day and arrive in Forli at 5 p.m. The times are local. Flights will be taking place till 1 September.
On 27 March Lufthansa will start daily flights between Tallinn and Munich.
LOT Polish Airlines will launch daily flights on the Tallinn-Warsaw route on May 10.
The national carrier Estonian Air will increase the frequency of flights on the Tallinn-Amsterdam route at the beginning of March. There will be six weekly flights with a stop in Vilnius.

Source: Estonian Review

Statoil to buy motor fuel from Finland, Norway

AS Eesti Statoil will this year buy motor fuel from Norwegian and Finnish refineries.
Statoil concept leader Kai Realo told BNS that the sources of supply had been different in different times: “Last year Eesti Statoil imported most of the motor fuel from Statoil ASA Mongstad refinery in Norway and only supplies of the summer diesel fuel were from the Lithuania’s Mazeikiai refinery.”
In its supply of motor fuels, Eesti Statoil proceeds from the Statoil ASA supply policy, according to which all supply contracts are concluded and supply is organised by the Oil Trading & Supply department of the group.
On the basis of the contracts signed, all motor fuels sold at Eesti Statoil service and unmanned stations are directly imported from refineries and no mediators are used in the transactions, Realo added.
Olerex marketing manager Antti Moppel told BNS that Olerex had signed a supply contract with Orlen Lietuva refinery in Lithuania. “Orlen Lietuva suplies Olerex both with gasoline as well as summer and winter diesel.”

Source: Estonian Review

Port of Tallinn confirms interest in Kazakh goods

Like Eesti Raudtee (Estonian Railway), the state-owned Tallinna Sadam (Port of Tallinn) has also confirmed interest in Kazakh goods. Board chairman of Tallinna Sadam Ain Kaljurand told BNS that at the railway forum in Tallinn, Kazakh Railway representatives said that they were interested in carrying their goods via Eesti Raudtee and Tallinna Sadam.
Kaljurand said that Kazakh Railway wanted to carry through Estonia two million tons of oil products and 600 000 to 800 000 tons of grain a year.
No concrete agreement had been signed yet but Tallinna Sadam is prepared for it, Kaljurand said. He said that the issue of the carriage of goods would certainly come under discussion at a meeting of Kazakh and Estonian government committees on 10 March.
He added that the carriage of goods was now obstructed by the Russian Railway carriage tariff but Russian Railway said at the meeting that it was prepared to revise the terms.
During its last fall’s visit to Kazakhstan Tallinna Sadam suggested the building of a terminal and distribution centre of Kazakh goods in the eastern part of the Muuga Harbour for where opportunities also exist.
The Kazakhs have also been offered the opportunity of using the existing terminals.

Source: Estonian Review

Gas company posts January sales record

AS Eesti Gaas, the natural gas importer and distributor in Estonia, sold 117 million cubic meters of gas in January, more than in any other month of January in the past decade.
“Definitely the reason here was the unusually long period of cold. For instance in Tallinn, which is the highest-consumption area for us, the month’s average air temperature was minus 11 degrees,” Eesti Gaas marketing chief Marge Randmaa told BNS.
In January 2009 the average air temperature in the Tallinn area was minus two degrees Celsius and in January 2008 it was minus 0.5 degrees.
“Another extraordinary thing compared with the previous years was that the average air temperature was minus 10 degrees or lower for 14 days in a row,” Randmaa said.
Sales of gas by Eesti Gaas in February will not reach the January figure, ending probably at less than 100 million cubic meters, Randmaa said.

Source: Estonian Review

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