Improved Unemployment Figures Signal Economic Recovery
Cyprus’ unemployment rate fell to 4% in the first quarter of 2026, down from 5% in the same period a year earlier, according to data released by Cystat. The number of unemployed people declined to 21,246 from 26,161 in Q1 2025, reflecting continued strength in the country’s labour market.
Gains In Employment Across All Demographics
Employment increased across the economy, with the number of employed persons rising to 510,265 from 493,272 in the first quarter of 2025. As a result, the employment rate reached 62.1%, up from 61.2% a year earlier, while the labour force expanded to 531,511 people, representing 64.7% of the population. The unemployment rate stood at 4% for both men and women. Among people aged 20 to 64, the employment rate increased to 81.5%, indicating continued gains across core working-age groups.
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Sectoral Contributions And Contract Trends
Services remained the largest source of employment, accounting for 81.8% of all jobs. Industry represented 16.3% of employment, while agriculture accounted for 1.9%. Part-time employment rose slightly to 8.9% from 8.8% in the first quarter of 2025. The share of workers employed on temporary contracts increased more noticeably, reaching 14.5% compared with 12.9% a year earlier.
Youth Unemployment: A Growing Concern
Despite broader labour market improvements, unemployment among people aged 15 to 24 increased to 13.1% from 11.2% in the same quarter of 2025. The youth unemployment rate was higher among men at 15.8%, compared with 10.5% among women. At the same time, 63.9% of unemployed people had been searching for work for less than six months, while the share of long-term unemployed fell to 20.3% from 23.5% a year earlier.
Conclusion
The latest figures point to continued improvement in Cyprus’ labour market, supported by rising employment and lower overall unemployment. However, the increase in youth unemployment suggests challenges remain for younger job seekers despite broader gains across the economy.
