Cyprus: Deflationary pressures continued through August

Cyprus: Deflationary pressures continued through August

Unemployment rates further dropped since employment rates increase

By Michalis Michael

Annual inflation in August 2017 remained negative, continuing its downward tendency for a third consecutive month. Inflation in August fell by 0.7% compared to August 2018, according to data released by the Statistical Service.

The decline was mainly explained by the drop in the food and non-alcoholic beverages industries, the rates of which fell by 3.19%, followed by transportations with a 2.94% dip, and communications, who decreased by 2.21%. Education prices rose by 1.86%. Furniture, household equipment and cleaning equipment industries followed with an increase 1.44%, with restaurants and hotels behind them, recording a surge of 1.24%. Prices in the Housing, Water, Electricity and LPG category experienced a 1.23% upward tendency, significantly lower compared to the previous months.

Nonetheless, according to the Statistical Service, the average index for the 12-month period of September 2018 – August 2019, when compared to the same index for the 12-month period of September 2017 – August 2018 reported an increase by 1.3%, while the increase during the corresponding previous 12-month period stood at 0.5%

Unemployment rates in the 2nd quarter of 2019 at 6.5%, a 4% increase recorded in employment rates

Unemployment rates fell to 6.5% during the second quarter of 2019, with employment rising by 4% on a year-over-year basis. Based on the results from the Labor Force Survey for the 2nd quarter of 2019, the workforce amounted to 447,364 individuals or 62,8% of the population (men 68,6%, women 57,4%) compared to 434,191 individuals (62, 0%) in the corresponding quarter of 2018 (Table 1).

The number of employees was 418,374 and the employment rate was 58.7% (men 64.2%, women 53.6%) compared to 402.302 individuals (57.4%) in the same quarter of 2018. On an annual basis, employment rates surged by 3.99%. The number of unemployed reached 28,989 and the unemployment rate corresponded to 6.5% of the labor force (men 6.3%, women 6.7%) compared to 31.888 individuals (7.3%) in the same quarter of 2018.

Regarding the division of employment by sector, Services accounted for the largest share of employees with 79.4%, followed by Industry and Agriculture with 18.1% and 2.5% respectively. For the second quarter of 2018 the respective percentages were: Services 81.6%, Industry 16.3% and Agriculture 2.1%. /ibna