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Cyprus Labor Market Strengthens in Q1 2025: Lower Unemployment and Robust Employment Growth

Overview of Q1 2025 Trends

In the first quarter of 2025, Cyprus witnessed a favorable labor market shift as reported by the Cyprus Statistical Service (Cystat). The unemployment rate declined to 5.0%, with 26,161 individuals recorded as unemployed, compared to 29,102 in the same quarter last year. This positive movement is indicative of a broader economic adjustment in the region.

Labor Force Expansion and Demographic Insights

The total labor force increased to 519,433—a representation of 64.4% of the national population. Male participation reached 275,358 (69.8%), while female participation stood at 244,075 (59.3%). This marks an uptick from the 505,963 observed in Q1 2024, signaling an expanding pool of active job seekers contributing to the economy.

Employment Metrics and Sector Distribution

Employment figures also improved, with the number of employed persons rising to 493,272, corresponding to an employment rate of 61.2%. For the working-age group (20–64 years), the employment rate ascended to 80.0% from 78.5% in the previous year. Men maintained a stronger presence in the workforce at 85.5%, compared to 74.6% for women.

Sectoral analysis reveals that the services sector remains the dominant employer, engaging 81.1% of the workforce, while industry and agriculture accounted for 16.8% and 2.1% respectively. Full-time positions continued to dominate employment, representing 91.2% of the total, with part-time roles comprising the remaining 8.8%.

Insights on Employment Structure

An in-depth look at the employment structure shows that 90.3% of employed persons are employees, with 87.1% holding permanent positions. The share of self-employed individuals slightly declined to 9.7% from 10.4% the previous year, reflecting subtle shifts in workforce dynamics.

Youth and Later Career Perspectives

For young individuals aged 15–24, the unemployment rate fell sharply to 11.2% from 16.0% in Q1 2024. Meanwhile, those between 25–64 enjoyed a reduction in unemployment to 4.7%. Workers aged 55–64 maintained a stable employment rate around 70%, although gender disparities persisted, with men faring better than women.

Unemployment Duration and Future Outlook

Analysis by duration of unemployment reveals that a majority (61.3%) of job seekers have been unemployed for less than six months. In contrast, 23.5% are classified as long-term unemployed, suggesting areas where targeted policy interventions could further enhance labor market efficiencies.

Overall, the Q1 2025 figures highlight a resilient and gradually improving Cypriot labor market. As employment and participation rates continue to grow, policymakers and business leaders might view these trends as a positive signal of economic stabilization and potential for future expansion.

Strained Household Finances: Eurostat Data Reveals Persistent Payment Delays Across Europe and in Cyprus

Improved Financial Resilience Amid Ongoing Strains

Over the past decade, Cypriot households have significantly increased their ability to manage debts—not only bank loans but also rent and utility bills. However, recent Eurostat data indicates that Cyprus continues to lag behind the European average when it comes to covering financial obligations on time.

Household Coping Strategies and the Limits of Payment Flexibility

While many families are managing their fixed expenses with relative ease, one in three Cypriots struggles to cover unexpected costs. This delicate balancing act highlights how routine payments such as mortgage installments, rent, and utility bills are met, but precariously so, with little room for unplanned financial shocks.

Breaking Down Payment Delays Across the European Union

Eurostat reports that nearly 9.2% of the EU population experienced delays with their housing loans, rent, utility bills, or installment payments in 2024. The situation is more acute among vulnerable groups: 17.2% of individuals in single-parent households with dependent children and 16.6% in households with two adults managing three or more dependents faced payment delays. In every EU nation, single-parent households exhibited higher delay rates compared to the overall population.

Cyprus in the Crosshairs: High Rates of Financial Delays

Although Cyprus recorded a notable 19.1 percentage point improvement from 2015 to 2024 in delays related to mortgages, rent, and utility bills, the island nation still ranks among the top five countries with the highest delay rates. As of 2024, 12.5% of the Cypriot population had outstanding housing loans or rent and overdue utility bills. In contrast, Greece tops the list with 42.8%, followed by Bulgaria (18.7%), Romania (15.3%), Spain (14.2%), and other EU members. Notably, 19 out of 27 EU countries reported delay rates below 10%, with Czech Republic (3.4%) and Netherlands (3.9%) leading the pack.

Selective Improvements and Emerging Concerns

Between 2015 and 2024, the overall EU population saw a 2.6 percentage point decline in payment delays. Despite this, certain countries experienced increases: Luxembourg (+3.3 percentage points), Spain (+2.5 percentage points), and Germany (+2.0 percentage points) saw a rise in payment delays, reflecting underlying economic pressures that continue to challenge financial stability.

Economic Insecurity and the Unprepared for Emergencies

Another critical indicator explored by Eurostat is the prevalence of economic insecurity—the proportion of the population unable to handle unexpected financial expenses. In 2024, 30% of the EU population reported being unable to cover unforeseen costs, a modest improvement of 1.2 percentage points from 2023 and a significant 7.4 percentage point drop compared to a decade ago. In Cyprus, while 34.8% still report difficulty handling emergencies, this marks a drastic improvement from 2015, when the figure stood at 60.5%.

A Broader EU Perspective

Importantly, no EU country in 2024 had more than half of its population facing economic insecurity—a notable improvement from 2015, when over 50% of the population in nine countries reported such challenges. These figures underscore both progress and persistent vulnerabilities within European households, urging policymakers to consider targeted measures for enhancing financial resilience.

For further insights and detailed analysis, refer to the original reports on Philenews and Housing Loans.

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