3.1 General context
On this page
On this page
Labour market situation in the country
As mentioned in the Cyprus National Reform Programme 2023 (pp.9-11), some of the main challenges in Cyprus have been managing implementation timelines, ensuring transparent evaluation processes, addressing budget constraints, coordinating among multiple authorities, adapting to industry changes, and conducting impactful assessments for Cyprus's initiatives aimed at enhancing SME competitiveness and economic growth. The Cyprus economy has been in the face of economic recovery from the pandemic, starting already as of the 2nd semester of 2021. In numbers, economic activity in 2021 expanded by 5.5%, fully recovering the lost ground of the recession in 2020 (-5.0%). However, given the continuous crisis in Ukraine and the imposition of significant sanctions to Russia by the US, UK and the EU, there is currently considerable geopolitical instability and uncertainty. Some of the sanctions are expected to have a direct or an indirect impact of the Cyprus economy, such as increased cost of energy, lower tourist arrivals, etc. The improvement of the quality of the Active Labour Market Policies, particularly for young people is included in the main reform priorities presented in the National Reform Programme.
Labour market conditions continued to be pretty similar during the period between 2020-2022 . According to Eurostat, the Youth unemployment rate in Cyprus (15-29 years) had a slight decrease from 14,2% in 2021 to 14,1% in 2022, reflecting a decrease of male youth unemployment rate to 13,8% from 15,1% and a slight increase of female youth unemployment rate to 14,4% from 13,2% .
As regards the proportion of young people not in employment, education or training (NEETs) for the age group 15-29, this was 14,7% in 2022 (Eurostat). Lastly, the youth long-term unemployment rate (12 months or longer) for the age group of 15-29 years old is estimated at 3,4% (Eurostat).
As announced on the official website of the Statistical Service of Cyprus, there were 14 304 registered unemployed people by the end of February 2024. Adjusted for seasonal variations, indicating the unemployment trend, the number of registered unemployed in February 2024 decreased to 11 687 compared to 11 823 the previous month. In comparison to February 2023, there was a reduction of 2 293 individuals or 13,8%, primarily attributed to the financial and insurance sectors, trade, construction, accommodation services, and catering services, as well as a decline in newcomers to the labor market.
Main concepts
In Cyprus, the right to work is granted to every young person from the age of 14, as stipulated by the Law on the Protection of Young Persons in the Employment. (Ο Περί Προστασίας των Νέων κατά την Απασχόληση Νόμος). Despite this legal provision, some encounter challenges in securing employment, particularly those categorized as not in employment, education, or training (NEETs).After the financial crisis, Cyprus continues its efforts to tackle unemployment and modernise and enhance its Public Employment Services (PES) [Δημόσια Υπηρεσία Απασχόλησης (ΔΥΑ)] through the strengthening of its human and technical capacity and also exploring the potential to improve efficiency in service provision, the performance of PES, as well as reinforcing outreach and activation support for young people who are NEETs. Concurrently, the government is actively promoting entrepreneurship among young people, demonstrating a concerted commitment to youth empowerment, especially through the Scheme for the Development of New Business Activity.