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Press release

Labour market

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The year 2018 was characterized overall by a new growth in employment – concerning both absolute values and rate – which involved also young people aged 15-34. Moreover, the drop in unemployed combined with the decrease in the number of inactive persons.

During the 2018, framework on employment worsened slightly. In the fourth quarter of 2018 employment decreased compared with the previous quarter, in a context of rising unemployment and decreasing inactivity. Such labour market dynamics reflected the decline in economic activity observed in the same period, characterized by a decline in Gdp (-0.1%) for the second consecutive quarter and after 14 quarters of expansion. As regards labour input, the GDP reduction was associated with diminishing hours worked on a short-term basis (-0.3%) and a slowdown in growth on an annual basis (+0.4%).

On the labour supply side, in the fourth quarter of 2018 employment decreased compared with the previous quarter (-36 thousand, -0.2%), as a result of a modest decrease of employees, in particular fixed-term employees, and a more accentuated reduction of self-employed. The employment rate remained stable at 58.6%. In the most recent monthly data (January 2019), net of seasonal effect, the employment rate remained static and the number of employees showed a slight increase compared with December 2018, as the result of a fall both of self-employment and fixed-term employees, more than offset by the increase of permanent employees.

The year-on-year trend showed a growth of 87 thousand employed people (+0.4% in one year), concentrated among temporary employees and self-employed (+200 thousand e +12 thousand, respectively), against the decline of permanent employees (-125 thousand). The incidence of temporary employees on the total number of employees reached 17.1% (+1.1 points) in 2018. The increase in full-time employment slowed down, whereas the number of part-time workers has increased again, as a result of the further increase of the involuntary component, whose incidence rose to 64.4% (+3.2 points) of part-time workers and to 12.0% of total employment.

In the yearly comparison, for the seventh consecutive quarter, the decrease in the number of unemployed continued albeit at a slower pace (-105 thousand in a year; -3.6%), involving both genders, all age groups and widespread throughout the geographical areas, with the exception of over-50. After the growth observed in the previous quarter, inactive people aged 15-64 decreased again (-100 thousand in a year; 0.8%). The unemployment rate increased in comparison with the previous quarter but decreased compared to the previous year, while inactivity rate (people aged 15-64) declined both in comparison with the previous quarter and with the previous year. Conversely, in the monthly data for January 2019, on a short-term basis, both the unemployment rate and the inactivity rate were stable at the same time.

In the flow data, permanence in employment showed a decrease, especially among young people aged 15-24 and people with a post-secondary school certificate. Transitions from non-employment were mainly towards inactivity and involved more often young people aged 15-24, men and the South and Islands area.

In enterprise data short-term signs of growth of labour demand were confirmed, with an increase in employee jobs by 0.3% on the previous quarter and by 1.8% year-on-year, derived from the growth both in industry and services. Compared to the increase in employee jobs, there was a decrease of hours worked per employee on a quarter over quarter basis (0.2%). A decrease of hours worked per employee was observed in comparison with the same quarter of the previous year (-0.8%). In addition, the use of short-time working allowance hours continued to decline. The job vacancy rate increased either compared with the previous quarter or year-on-year, respectively by 0.1 and 0.2 percentage points. Labour cost increased by 0.3% compared to the previous quarter and by 1.9% compared to the same quarter of the previous year, as a result of an increase in social security contributions (+0.3% on a short term basis and +4.5% on an annual basis) and in wages (+0.3% compared to the previous quarter and +1.0% on an annual basis).

Note. On 13 March 2019 at 5:00 p.m. the attached full text has been replaced due to data correction on the large municipalities at page 5 in the “Focus on the territorial trend of labour force in 2018”.

Reference period: Fourth quarter 2018

Date of Issue: 13 March 2019

Next release: 13 June 2019



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