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Cyprus Employment Data: A Comprehensive Analysis of Recent Trends

Recent data released by Cyprus’ statistical service, Cystat, indicates a moderate easing in the nation’s unemployment rate to 4.1% for the third quarter of 2025, a decline from 4.5% recorded in the comparable period of the previous year. The number of unemployed persons dropped to 21,781 from 23,073, reflecting a positive shift in the overall labor market dynamics.

Increased Labor Force And Gender Participation

The labor force expanded to 530,992 individuals, representing 65.6% of the total population, up slightly from 65.7% of 516,127 individuals in Q3 2024. Notably, participation rates vary by gender, with men maintaining a participation rate of 71.1% compared to 60.4% for women. These figures underscore the importance of targeted initiatives to further balance participation across demographics.

Robust Employment Figures And Sector Analysis

The total number of employed persons reached 509,211, yielding an overall employment rate of 62.9% – a slight improvement on the 62.7% recorded a year earlier. Detailed dissection of the data reveals that 269,513 men (68.5%) and 239,698 women (57.6%) are actively employed. Among the prime working age cohort (20–64 years), employment surged to 81.6%, with men at 86.6% and women at 76.8%. The aggregate employment performance among individuals aged 55–64 remained steady at approximately 70.9%.

In terms of industry sectors, the services sector continues to dominate employment figures by encompassing 81.4% of jobs, followed by industry at 16.3% and agriculture at 2.3%. These structural shifts suggest an economy that is becoming increasingly service-oriented while maintaining stability in manufacturing and agricultural segments.

Work Arrangements And Employment Contracts

The vast majority of workers are employed full-time, with 91.2% (464,604 individuals) in such roles, compared to 8.8% (44,607 individuals) in part-time positions. Additionally, among employees, a significant 15.5% (71,008 individuals) are on temporary contracts, a minor increase from 14.5% in Q3 2024. The self-employed segment remains relatively stable at 9.8% of the workforce, reflecting a measured entrepreneurial presence within the economy.

Youth Unemployment And Durations Of Joblessness

Among younger demographics, the unemployment rate for individuals aged 15–24 escalated to 13.1% (14.1% for men and 12.1% for women) from 12.1% in the previous year. Conversely, the unemployment rate among those aged 25–64 experienced a decline to 3.6% from 4.0%. Moreover, 63.8% of the unemployed had actively sought work for less than six months, 16.8% had been searching for six to eleven months, while long-term unemployment (exceeding one year) accounted for 19.4%, down from 23.5% a year earlier. This trend highlights the resilience of the labor market in reintegrating job seekers within shorter timeframes.

Conclusion

The latest employment statistics from Cyprus illustrate a cautiously optimistic outlook for the labor market, marked by modest improvements in unemployment rates and a stable expansion of the workforce. As the service-dominated economy continues to thrive, ongoing efforts to address gender disparities and youth unemployment will be critical in sustaining long-term economic growth and stability.

Bank of Cyprus Upgrade Signals Fresh Optimism For Greek And Cypriot Banks

Regional Banks Enter A More Favorable Cycle

Bank of Cyprus and Eurobank are well positioned to benefit from a renewed re-rating of Greek and Cypriot bank stocks, according to Cyprus-based investment firm Roemer Capital, which upgraded Bank of Cyprus to a buy rating and reaffirmed its positive view on Eurobank.

The firm cited easing geopolitical tensions, resilient economic growth in Greece and Cyprus, lower funding costs and Greece’s expected transition to developed-market status as the main factors supporting the sector.

Roemer Capital also lowered its cost of equity assumptions, updated its forecasts following first-quarter 2026 results and extended its valuation horizon to the end of 2027, raising target prices across its banking coverage.

Bank Of Cyprus Gets The Largest Upgrade

Bank of Cyprus received the biggest revision, with Roemer Capital upgrading the stock from hold to buy and setting a target price of €11.10, implying potential total upside of 27%.

The firm highlighted the bank’s strong capital generation, profitability and projected 100% dividend payout, describing it as the strongest capital-return story among the banks under coverage. Roemer Capital maintained its buy rating on Eurobank, assigning a target price of €4.90 and forecasting potential upside of 28%. The report said the bank is well placed to benefit from loan growth, improving operating performance and merger-and-acquisition synergies.

National Bank of Greece and Piraeus Bank also retained buy ratings, with expected returns ranging from 25% to 36%. Optima Bank was upgraded to buy, while Alpha Bank remained at hold on valuation grounds.

Why Growth Still Sets The Region Apart

According to Roemer Capital, Greek and Cypriot banks continue to benefit from stronger economic fundamentals than many western European peers. The report pointed to faster economic growth, healthier balance sheets, low levels of non-performing exposures, capital ratios approaching 20% and strong customer deposit bases.

Analysts expect performing loans across the sector to grow at a compound annual rate of 6% to 8% through 2028, supported by private investment, digitalisation, green manufacturing, supply-chain expansion and a gradual recovery in household lending.

The report also said the conclusion of lending under the EU Recovery and Resilience Facility is unlikely to materially affect credit growth, as banks have already shifted back towards traditional commercial lending. Roemer Capital expects Euribor to remain between 2.2% and 2.5%, a level it believes should support both lending activity and net interest margins.

Geopolitics, Valuation And Market Structure Support The Case

The report said improving geopolitical conditions have strengthened the investment outlook, noting that Brent crude prices have largely returned to pre-war levels while Greek government bond yields have stabilised at around 3.5%. Although geopolitical risks remain, Roemer Capital believes the likelihood of a major inflationary shock or significant pressure on bank profitability has eased.

Another important catalyst identified by the firm is Greece’s expected promotion to developed-market status by FTSE Russell, STOXX and MSCI over the coming months.

According to the report, the reclassification should improve liquidity and attract a broader base of international investors. Roemer Capital also said Euronext’s acquisition of the Athens Exchange is expected to strengthen market infrastructure and increase international visibility, particularly for Bank of Cyprus and Optima Bank.

The firm noted that Bank of Cyprus has already benefited from its Athens listing, with average daily trading value increasing from less than €400,000 before its September 2024 move to nearly €6 million afterwards.

Economic Momentum Remains A Core Tailwind

Roemer Capital said both Greece and Cyprus have moved beyond post-crisis recovery and are now supported by private-sector-led growth. For Cyprus, the report highlighted recent tax reform and efforts to simplify the legal and regulatory framework, while also noting that limited foreign banking competition continues to support domestic lenders.

Overall, Roemer Capital expects Greek and Cypriot banks to remain well-positioned for profitable loan growth over the coming years.

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