Since its independence in 1991, Latvia has implemented several market-oriented reforms to stabilize the nation's economy. The Latvian economy has performed well due to steady and upward growth in domestic consumption plus the contribution of foreign investment. Being a member of the EU since 2004 and the Eurozone since 2014, the country has benefited from substantial European funding.
The small, open economy of the nation significantly relies on exports. A huge population of the country is involved in transit services, wood processing, agriculture and food products, machinery manufacturing, and electronics industries.
Overview of Latvia
Population: 1,865,317(July 2021)
GDP: 31.00 USD Billion (FY 21)
Economic Overview: Since 2011, the growth rate of the Latvian economy has been positive, and in 2019, it was the highest among the European countries. Like the remaining world, the COVID-19 pandemic has negatively impacted economic growth, and the GDP dropped to -3.6% in 2020. With the post-pandemic global recovery, foreign investment and domestic consumption should strengthen in the coming months, and the economy is expected to recover up to 3.9% in 2021 and 5.2% in 2022.
Market Size: The job market is dynamic and has enough capacity to accommodate the nation's working-age population. Unfortunately, the COVID-19 crisis has increased the number of unemployed individuals. According to the IMF, in 2021, the unemployment rate will decrease to 7.2%. The government has taken temporary stimulus measures to offset the effects of the COVID-19 crisis and improve the job market.
A brief glimpse of industries:
- Latvia's ports, rail, and roads keep the country well-connected with Europe and the rest of the world; 25 million customers are reachable within 48 hours in the Baltic region next to Latvia. Due to the well-connected transport facility, logistics is one of the pillars of the Latvian economy.
- Latvia’s main industries have started to invest more in chemicals, textiles, food processing, green technologies, and machinery production.
- The industrial sector comprises construction, metallurgy, industrial food-processing, and mechanical engineering. The nation is well-known as an important producer of radios, refrigerators, medicines, railway equipment, timber, and steel by-products.
- Skill training programs for IT skills, language knowledge, and communication skills have been initiated to meet the skill gap in information technology and international organizations.
- The average Internet speed in Latvia is 113.73 Mbps. The average download speed in Latvia is 128.35 Mbps, and the upload speed is 127.54 Mbps.
- The government is encouraging foreign investment in service sectors to improve the economy as well as the job market.
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Cost of living in Latvia
Latvia is one of the low-cost countries in the Eurozone. It is comparatively cheaper than other Eurozone countries, like Germany or the Netherlands. However, the living cost depends on multiple factors, like the location (capital, other cities, or town), the type of industry dominant in that area, lifestyle, etc. Latvia offers affordable food and beverage costs. Cities are moderately expensive than towns and rural areas. A single person’s estimated monthly cost is about $ 1,376 in the nation. The following table represents the average living expenses in Latvia.
Average Living Cost in Latvia
Cost of renting
The cost of renting in Latvia depends on a particular location; cities like Riga are more expensive than small towns. However, overall house rent in the nation is quite affordable and cheaper than in other Eurozone countries.
Riga and Jurmala are the two most expensive places to live in Latvia. The following table shows some instances of living costs plus house rent in the country.
The top sectors that are expected to hire in Latvia in 2021
Top Skills in Latvia
Here the job market is dynamic, and highly skilled professionals are on-demand in the Latvian labor market. IT skills, language, and communication skills are high in demand in the job market. The topmost skills on-demand are communication skills, knowledge of the state language and Russian, planning and time management, computer hardware knowledge, and programming skills. Tech knowledge and skills related to artificial intelligence and large data programming are also high in demand in the IT industry.
Major industries hiring the most in Latvia include:
- Food processing
Top Skills City-wise Occupation-wise
There are multiple job opportunities available in the capital city of etcrecruitment-relatedRiga. Many international companies have bases in this city—lower taxes and salaries attract many tech companies to Riga. Being one of the key economic and financial centers of the Baltic States, half of all the jobs in Latvia are in Riga. This city offers most opportunities in the field of:
- Marine transportation
- Broadcasting & entertainment
- IT and Telecommunications
- Food and beverage manufacturing
Other prominent cities that offer multiple job opportunities in Latvia are Liepaja, Ventspils, and Sigulda. These cities are offering employment options in:
- Client service
- Transportation services
- Industrial machinery
Jurmala is the talent hub of the nation. Many opportunities exist for skilled professionals in computer hardware & software and telecommunication services.
Cost per hire is one of the crucial factors for any organization planning to hire new workforces. And when you plan to hire in a foreign country, it needs a lot of research and analysis regarding the cost of living, availability of required skills, etc., to calculate the compensation for the right candidate. Moreover, hiring cost is a cumulative sum of all the costs associated with filling a position, such as advertising expenses, recruiting events costs, recruitment software fees, onboarding costs, training costs, travel costs, administrative costs, and benefits.
Salary structure for various roles in Latvia
The following table represents the average monthly salary of different sectors in Latvia.
Employment Laws in Latvia
- The Constitution of the Republic of Latvia governs the employment relationships in Latvia. The norms of international law, the constitution of the Republic of Latvia, and some other laws and regulations collectively form working procedure regulations.
- The legal framework has moved more towards flexible employment policies and employee-friendly codes.
- The regulations that apply are elementary; however, the authorities have substantial power.
The primary laws governing employer-employee relationships in Latvia are:
- the Labour Law
- the Labour Protection Law
- the Labour Disputes Law
- the Law On Strikes
- the State Labour Inspection Law
- the Law On the Protection of Employees in the Event of Insolvency of Employer
- the Law On Trade Unions
- the Law On Employers' Organisations and their Associations
- the Support for Unemployed Persons and Persons Seeking Employment Law
- the Law On Informing Employees of European Community-scale Commercial Companies and European Community-scale Groups of Commercial Companies and Consulting Such Employees
How Can Skuad Help You in Hiring in Latvia?
Hiring in Latvia is a hectic task requiring in-depth knowledge of the hiring cost, city-wise living cost, employment laws, trends, and so on. Skuad can be your one-stop solution for all recruitment-related complications or assistance handling every aspect of recruitment. It gives you the freedom from hiring stress and allows you to focus on your project and expansion plans. Connect Skuad to know more!