Working international students and graduates paid over 10 mEUR in taxes

Statistics Estonia prepared an analysis for Archimedes Foundation on the participation of international students in the Estonian labour market and its impact on the economy. It appeared that in the previous academic year, foreign students paid eight million euros in income and social tax in Estonia. International students who graduated the year prior contributed additionally over two million euros. The share of international students who work besides studying has increased significantly in the last three years. A half of them continue working in Estonia even after receiving a diploma.

Working international students and graduates

There are more than 5,000 international degree students in Estonia. One in ten students in Estonian higher education institutions comes from another country. Each year, study opportunities in Estonian higher education institutions are promoted abroad. Archimedes Foundation sought to find out whether and how international students participate in the Estonian labour market.

“Foreign students who get accustomed to life in Estonia during their studies could contribute to the local labour market and economy also after graduation. Considering that the money foreign students earn is also spent in Estonia, it can be estimated that, in the previous academic year, international students contributed around 20 million euros to the economy,” explained Eero Loonurm, head of the international marketing agency at Archimedes Foundation. He added that one of the indicators in the strategy for the international promotion of Estonian higher education is employment in Estonia after graduation. The objective is that 30% of international students in Master’s or Doctoral studies would continue working in Estonia.

Kadri Rootalu, data researcher at Statistics Estonia, explained that by combining databases Statistics Estonia’s experimental statistics team can study data on student employment in more detail, for example, by level and field of education. “It came as a surprise that international graduates make such a big contribution in information and communication as well as manufacturing enterprises,” said Rootalu.

Facts

  1. Approximately a half of international students in Estonia work besides studying, compared to over 80% of local students.
  2. The share of international students who after graduation stay in Estonia for work has slightly increased in the last two years: in 2017, it was 45%, and in 2018, it was 51%.
  3. The share of working international students is smallest in integrated study programmes. Only a few international students in these programmes work besides studying, as opposed to around 80% of local students. Compared to other levels of study, international students in Bachelor’s studies work less.
  4. The share of international students with a Master’s or Doctoral degree who worked immediately after graduation was 56% in academic year 2016/2017 and 58% in 2017/2018.
  5. The most likely to continue working in Estonia after finishing studies are international students of Tallinn University and Tallinn University of Technology.
  6. The most likely to work besides studying are international students in information and communication technologies; engineering, manufacturing and construction; and business, administration and law (two thirds of international students in these fields worked in academic year 2018/2019). Graduates in the same fields also stay working in Estonia more frequently compared to others. A contributing factor could be that there are many enterprises offering an international work setting for graduates of these fields.
  7. For years, international students have mainly worked in administrative and support service, accommodation and food service and information and communication enterprises.
  8. Compared to local students, international students are more likely to work in enterprises in foreign ownership.
  9. In academic year 2018/2019, international students in Estonia paid 2.4 million euros in income tax and 5.6 million euros in social tax.
  10.  International students in information and communication enterprises contributed the most (total income tax paid in academic year 2018/2019 was 0.73 million euros). The contribution of foreign graduates was also largest in this economic activity.
  11. In 2018/2019, international students who graduated in 2017/2018 paid 0.9 million euros in income tax and 1.9 million euros in social tax in Estonia.

The analysis covered international students and graduates in academic years 2016/2017–2018/2019 who had Estonian ID codes and were entered into the Estonian Education Information System. Employment and income of the students were observed on the basis of records in the employment register and tax form TSD of the Tax and Customs Board.s

Statistics Estonia’s experimental statistics team performs contract work that involves linking or combining the data of Statistics Estonia with register or survey data. The team also engages in data mining and analysis, builds statistical models and assesses policy impacts.

The study was supported by the Dora Plus Programme, which is financed from the European Regional Development Fund as part of European structural funds.

Source: Statistics Estonia

Commercial registers of Estonia, Finland starting on data exchange

Secretary-general at the Ministry of Justice, Tõnis Saar, and director general of the Finnish Patent and Registration Office, Antti Riivari, signed an agreement on Tuesday on the exchange of data between the commercial registers of Estonia and Finland from here on in.

Under the agreement, Estonia and Finland will open their commercial registers for a data exchange that includes all the information typically sent to the authorities of their own country.

On the Estonian side, the authority thus gaining access is the Tartu County Court’s department of registers, and on the Finnish side the Patent and Registration Office. Only individuals tasked with processing the data and who need it for the performance of their daily duties will have access to the information of the other side, and no data will be forwarded to third parties, the ministry said in a press release.

The preparations for the launch of the automatic data exchange have been completed, the x-Road systems of Estonia and Finland have been linked and the proper functioning of services has been tested, the ministry added.

In May 2016 the prime ministers of both countries signed a joint declaration on data exchange and exchanges of e-services between Estonia and Finland. A similar exchange is already ongoing between the Estonian and Finnish tax authorities.

Source: ERR News

Enterprise Estonia to open office on US east coast in 2019

Enterprise Estonia is to open an office on the east coast of the United States in 2019, offering cooperation between US partners in industry and technological development and businesses participating in its business and product development programs.

The exact location of the office has not yet been announced, though cooperation with partners in the state of South Carolina seems to have been the genesis of the move.

“If an Estonian enterprise finds a partner from South Carolina within the framework of this agreement, it will have the option of receiving support from the development program or product development aid to finance the project,” Tanel Rebane, director of the Trade Development Agency at Enterprise Estonia, said.

Read more from ERR News

The impact of sanctions on Russian and European economies

According to the working papers of Bank of Estonia: The conflict between Russia and Ukraine that started in March 2014 led to bilateral economic sanctions being imposed on each other by Russia and Western countries, including the members of the euro area. The paper investigates the impact of the sanctions on the real side of the economies of Russia and the euro area. The effects of sanctions are analysed with a structural vector autoregression. To pin down the effect we are interested in, we include in the model an index that measures the intensity of the sanctions. The sanction shock is identied and separated from the oil price shock by narrative sign restrictions. We nd a very high probability that Russian GDP declined as a result of the sanctions. In contrast to that, the effects of the sanctions on the euro area are limited to real effective exchange rate adjustments.

Read more from here ( 5/2017 Konstantin A. Kholodilin, Aleksei Netšunajev. Crimea and punishment: The impact of sanctions on Russian and European economies)

Estonia’s Russian-speaking residents against NATO presence

While among Estonian-speaking residents, support for the presence of NATO forces in Estonia is high, the majority of the Russian-speaking population is against it, results of a survey commissioned by the Ministry of Defence show.

Results of the survey show that 69 percent of Estonian residents support the presence of NATO forces in the country, and 23 percent are against it. Two years ago the indicators were 68 percent and 25 percent respectively.

While 89 percent of the Estonian-speaking population support the presence of allied forces and only 6 percent are against it, just 27 percent of the Russian-speaking residents support the presence while 57 percent are against it.

Sociologist Juhan Kivirähk of pollster Turu-uuringute AS that carried out the survey said that this attitude could also be seen looking at attitudes towards Estonia’s being a member of NATO.

The survey was carried out in March. 1,202 Estonian residents were interviewed. Since January 2000 and including this latest one, no fewer than 41 surveys have been conducted to sound out attitudes towards the alliance.

Source: BNS via ERR News

Border maintenance workers arrested by Russian border guard

Two men using a road on Russian territory to get from one Estonian village to another were arrested by Russian border guards on Thursday. Unaware that they had left Estonia, they stopped their vehicle, which according to current agreements between the two countries isn’t allowed. They were subsequently arrested and taken in for identity checks, but allowed to return after paying a fine.

Read more from ERR News

Nearly half of quota refugees currently not in Estonia

Nearly half of the refugees that have arrived in Estonia under the EU’s migrant distribution plan are not currently in the country and four families that are absent have been away from Estonia for more than 90 days, officials from the Ministry of Social Aaffairs said on Monday.

Triin Raag, head of international protection policy at the Ministry of Social Affairs, told BNS that besides the two families that have previously been known to be outside of Estonia for more than 90 days, another two families have now been away for that long. Both families came to Estonia from Greece this January. The seven-member family was sent to live in Tartu and the five-member family to live in Põlva.

Read more from ERR News

The immigrants to Estonia mostly come from Finland (45 pct)

According to Statistics Estonia, 14,822 persons immigrated to and 13,792 persons emigrated from Estonia in 2016. Immigration exceeded emigration for the second year. Most of the migrants were Estonian citizens, but their net migration was negative.

The most active group of migrants are 20–39-year-olds. The age group that grows the most in the population due to migration is that of 15–39-year-olds. 60% of the migrants are men and 40% are women. The net migration of men is four times higher than that of women – 800 more men arrived in Estonia in 2016 than left the country, whereas the same number for women was 200.

Most of the migrants are Estonian citizens, but there are more of them among emigrants, causing the net migration of Estonian citizens to be negative by 2,000 persons in 2016. The migrants are Estonian citizens aged 20–59, therefore, the age group of migration is quite large. In net terms, Estonia mainly loses citizens who are in their twenties.

As a result of migration, the number of Ukrainian citizens grew the most in Estonia; 850 more Ukrainian citizens arrived in Estonia in 2016 than left Estonia. In net migration, they were followed by the citizens of the Russian Federation, Finland and Latvia.Immigration by citizenship, 2016

Emigration by citizenship, 2016

The immigrants to Estonia mostly come from Finland (45% of immigrants), Ukraine (11%) and Russia (11%).  88% of the immigrants come from Europe, mainly from the European Union. The main destination country for emigrants is still Finland (58%), followed by the United Kingdom (9%). 94% of the emigrants left to a European country. The immigrants arriving from countries outside Europe have previously lived in the USA, Australia and India. The more popular destinations for emigrants leaving Estonia to non-European countries are Australia and the USA.

The press conference which presents an overview of the 2016 migration trends takes place today, on 23 May at 11 in the 5th floor conference room of Statistics Estonia (Tatari 51).

As of 2015, Statistics Estonia calculates external migration based on the residency index: a person’s transition from (Estonian permanent) resident to non-resident is emigration and the opposite is immigration (unless it is a case of birth or death). As a result, migration flows have increased and this must be taken into account when comparing migration data of 2015 and later to that of previous years. As a result of the changes, Estonia’s external migration also reflects unregistered migration; however, the country of origin and destination of many immigrants and emigrants remains unknown.

Source: Statistics Estonia

Estonian immigration exceeded emigration in 2015

According to Statistics Estonia, 15,413 persons immigrated to and 13,003 persons emigrated from Estonia in 2015. Net migration was 2,410 and natural increase -1,336, meaning that immigration compensated for the population decrease which occurred due to negative natural increase.

The most active group of external migrants was the group of 20–39-year-olds. In most age groups immigration exceeded emigration with the exception of the age groups of 10–14-year-olds and 25–29-year-olds. The number of men among the migrants exceeded that of women, but net migration indicates that the number of women who remain abroad exceeds that of men.

52% of the immigrants and 69% of the emigrants were citizens of Estonia, therefore the back-and-forth mobility of citizens of Estonia continues to constitute the majority of the external migration. 21% of the immigrants were EU citizens and 27% were citizens of third countries. 15% of the emigrants were EU citizens and 10% were of other citizenship. The EU citizens that immigrated were younger than the immigrants that were of Estonian or other citizenship, which, in the case of citizens of Estonia could be explained by the fact that they were mostly returning migrants. Of the citizenships that were most represented in external migration, the only number to decrease as a result of net migration was that of Estonian citizens. The increase was biggest for the persons holding citizenship of a third country. As a result of external migration, the biggest foreign citizenship groups that remained in Estonia were those of Ukraine, Russia and Finland. The immigration and emigration of EU citizens and people with undetermined citizenship balanced each other out.

Most of the persons whose migration country is known have gone to Finland or come from there. The main destination countries include other highly developed European countries such as the United Kingdom and Germany. The main source countries of immigration are, in addition to Finland, also Ukraine and Russia. By birth country, 49% of the immigrants are from Estonia, 11% from Russia and 8% from Ukraine. 68% of the emigrants were born in Estonia, 9% in Russia and 4% in Finland.Diagram: Immigration by citizenship, 2015

Diagram: Emigration by citizenship, 2015

As of 2016, Statistics Estonia calculates external migration based on the residency index: a person’s transition from resident to non-resident is emigration and the opposite is immigration (when it is not the case of birth or death). As a result, migration flows have increased and this must be taken into account when comparing 2015 migration data to that of previous years. As a result of the changes, the Estonian external migration reflects reality more accurately; however, the country of origin and destination of many immigrants and emigrants remains unknown.

Source: Statistics Estonia

The price level in Estonia falls under pressure from factors from abroad

  • The main cause of the fall in prices in February was the continuing descent of commodity prices on the global market
  • Prices fell for motor fuels in February even though the euro has weakened against the dollar and higher excise rates started to apply
  • Estonian companies use imported commodities as production inputs, and this has reduced core inflation
  • Uncertainty in the global economy is holding down the expectations of consumers and slowing growth in consumer prices in Estonia and in the euro area

Data from Statistics Estonia show that the consumer price index was 0.5% lower in February than a year earlier. The harmonised index of consumer prices for the euro area was also down, with consumer prices down by 0.2% over the year.

The main reason prices fell in Estonia was that commodities prices were again down on global markets. Falls in prices in foreign markets affect Estonian consumer prices through various channels. Lower prices for imported energy and food products have a direct impact. After the price of electricity was pushed up for a time in January by the cold weather, the fall in energy prices accelerated in February to 8.9%. Prices for motor fuels were 10.1% lower in February than a year earlier even though the euro had weakened against the US dollar and excise on motor fuels was raised in February.

Although the euro is lower against the dollar, the nominal effective exchange rate for Estonia, which takes account of all trading partners and the currencies used in transactions, has constantly strengthened over the past year. The main reason for this has been the sharp fall in the Russian rouble and the significant Russian share of Estonia’s trade, though the share has been reduced. The total effect of the divergence in the exchange rates has been to lower Estonian inflation by an estimated one percentage point.

Cheaper commodities also affect Estonian consumer prices indirectly as Estonian companies use imported commodities as production inputs. This brings down core inflation, which is the rise in prices of manufactured goods and services, and in February it stood at 1.3%. On top of the fall in prices for some production inputs, the low level of economic activity also reduced core inflation.

Inflation is also moved by the expectations of consumers. Uncertainty in the global economy is holding back rises in consumer prices in Estonia and in the whole of the euro area. The consensus forecasts of economic analysts for Estonia two years ahead have been steadily lowered for inflation to 2.3%. The calculations indicate that inflation in Estonia has been pulled down by around 0.8 percentage point by expectations in recent years. The economic forecast published by Eesti Pank in December put expected inflation at 1.2% for 2016, but the lower prices for commodities in recent months make it probable that inflation will be lower.

inflation