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How can Estonian Unemployment Insurance Fund help, when finding and training employees is costly?

The need for workers with different occupations and skills is constantly changing. New jobs require different skills from those previously acquired. Do you remember the accountant's desk 30 years ago? In its rightful place there was a clipboard that they used to teach you how to use in school - now a completely useless skill.

Experts say the nature of the job is changing. For the economy to thrive, we need to rethink the way we work, the way we organise work and match the needs and skills of our workforce. Workers need to be ready to adapt and learn new skills, and employers must accept that finding the 'ready' worker is becoming increasingly difficult.

There are many ways to find workers. The simplest is to post a job vacancy on the Unemployment Fund portal. By entering a job offer, the employer can see immediately how many suitable candidates there are in the database. There are more than 30 000 CVs in the database. If, however, the right skills cannot be found, it is important to think about how to train them to meet the company's needs.

Estonian Unemployment Insurance Fund (Töötukassa) will support, through training grants, the recruitment of workers for occupations which will be of growing importance in the coming years and where there is a shortage of suitably qualified workers. In doing so, the Unemployment Insurance Fund works with the Vocational Training Chamber (Kutsekoja), which draws up sectoral surveys of labour and skills needs (so-called OSKA surveys). Employers can apply for training support if they have advertised for such occupations on the Unemployment Insurance Fund's portal, but have still not found people with the necessary skills.

An example of this is Estonian Plywood AS, a veneer and plywood company in Jõgeva County. The company was set up in July 2017 and it took around two years to produce its first plywood board. This time included the construction of the plant, including the design, as well as the implementation of staffing, purchasing, sales, quality and other projects. Today, construction and equipment installation are nearing completion, and the focus is on staff training and increasing the plant's production capacity. There are currently around 150 employees.

Estonian Plywood AS recruited production workers and production equipment technicians for its plywood plant. In total, the Unemployment Insurance Fund has supported Estonian Plywood AS in training 103 workers this year. The cooperation with the Unemployment Insurance Fund started with a phone call - a specialist from the Unemployment Insurance Fund contacted the company and introduced the possibilities of training support. The company's managers emphasise that it is cooperation with the employers' consultant in their region that is the key to breaking through some of the bureaucratic barriers that may seem daunting at first glance. "It was most convenient to apply for support online, and if there were any technical glitches, the Unemployment Insurance Fund specialists always came to the rescue and helped to overcome the obstacles. The speed of the procedure and decision making by the Unemployment Insurance Fund's assessment committee was a pleasant surprise", summarise the company managers' experience and add. As the training allowances offered by the Unemployment Insurance Fund are tempting enough, it is wise to take a few days to get to grips with the subject and get the project up and running."

The Tallinn University of Technology designed a training curriculum "Basic training in plywood production" specifically for the company's employees. Six training groups have already received their training and passed the knowledge check with the support of the Unemployment Fund. As most of the employees of Estonian Plywood AS have not been exposed to veneer and plywood production before, the basic training will allow each employee to see the bigger picture and to start working much faster. As the in-service training of the employees is partly financed by the state during the start-up phase of the plant, this leaves the company with resources to plan new training activities and to order further training.

Estonian Unemployment Insurance Fund will support training where the worker must be trained for at least 50 academic hours. The training must take place over a period of one year.

Estonian Unemployment Insurance Fund will reimburse the employer for the training costs of the employee, the wage costs for the time spent on the training (at the lower hourly rate) and the travel costs incurred by the employer when the employee attends training abroad. In general, up to 80% of the above costs per worker, up to a maximum of €2500. If the new worker is found among the unemployed registered with the unemployment office, 100% of the training costs are reimbursed, up to a maximum of €2500 per worker. The worker must have an employment contract for an indefinite period or at least six months. An application for the training allowance must be submitted to the e-Employment Fund before the training starts.

A decision on the grant should be taken within 3-4 weeks. Initially, the employer bears all the costs of the training. The training allowance will be paid to the employer on the basis of a statement of costs.
In cooperation with the Labour Market Fund, Estonian Plywood AS is planning to organise group counselling sessions for its production teams in the future, together with a career counsellor, in order to help team members get to know each other better, to clarify the values of the organisation and to map the current situation - what is working well, what are the expectations of the employees and what needs to change at personal, team and organisational level.

More information:

- For more details on how to apply for a training grant, please visit theUnemployment Insurance Fund's website under the Work and Learn section

- If you have any questions, please send an e-mail to or contact an Unemployment Insurance Fund employer adviser

Author: Riina Kurg, Estonian Unemployment Insurance Fund Service Manager

Almost every other unemployed person in Pärnu County wants flexible working hours from their new employer

A very large number of people currently registered as unemployed in Pärnu County, who have indicated a job in the tourism sector as a possible future occupation, would like the opportunity to work part-time, i.e., flexible working hours, noted Gerli Mets, Head of the Pärnu County Department of the Estonian Unemployment Insurance Fund.

As at the end of 2021, there were 2859 unemployed people registered in Pärnu County, including 888 people with reduced work ability. The overall unemployment rate in Pärnu County was 7% (the average unemployment rate in Estonia is 6.7%). Out of the total unemployed in Pärnu County, 1201 are ready to start working part-time – 42% of all registered unemployed people.

Mets adds that the Estonian Unemployment Insurance Fund always helps hotels, spas and restaurants in Pärnu – the summer capital of Estonia – to find new employees. ‘We are looking forward to meeting this new season by hopefully being able to hold a contact open doors week for employers in the HoReCa sector,’ Mets said. She added that they often contact regionally relevant employers and negotiate the backgrounds of the people they are looking for. Then, with the help of their consultants, they find the right people and bring them to the employer’s site.

‘We have already met with the managers of Pärnu’s oldest beach hotel – Rannahotel – and the Estonia Spa, who are also contributing to the Pärnumaa Vocational Education Centre’s advisory board. They are also willing to experiment with out-of-the-box solutions. We would also like to organise a summer seasonal jobs fair for young people this spring. When it comes to young people, some contradictory information has been heard: employers are complaining that there are no young people, and the young people are complaining that there is nowhere to go to work for the summer. Our mission is to bring them together,’ Mets commented.

The manager also admitted that unofficial working is unfortunately a problem in Pärnu’s small cafes. ‘If a client gives feedback to his consultant during the counselling that he was offered an informal job during the job interview, we will also inform the tax office,’ Mets stated firmly.

Low wages in the HoReCa sector are also a problem

Kristjan Heamäe, employers’ consultant at the Pärnu County Department of the Estonian Unemployment Insurance Fund, added that in previous years 7-8 employers from Pärnu have participated in the open doors event. ‘If we can get the timing right, the hotels, spas and restaurants of Pärnu will also find their employees in time,’ Heamäe said.

At the same time, he added that hotels must also definitely engage in self-branding. ‘Low wages in the sector are also a problem. It is true that gross pay has gone up for some posts, but this remains in the range of EUR 600-1000.

Heamäe added that employers should also show some flexibility with jobseekers. ‘If, for example, a dishwasher has to work 10 hours a day, a person with reduced work ability will not take the job because he may also have health problems resulting from years of hard physical work. And a reminder to all employers that if you employ a person with reduced work ability, you can also get a social tax refund from the Estonian Unemployment Insurance Fund. But employers are reluctant to change schedules that have been in place for years,’ Heamäe said.

She cited the example of a conversation with the owner of a manufacturing company in Pärnu, who said that he had hired a loader who had lost one of his hands and was amazed that the man sometimes worked even faster than his two-handed colleagues. ‘If you want to hire people today, you still have to take into account that employees are dictating the market and employers also have to change. Employees have already adapted to many changes in today’s world, and now employers are having to constantly change,’ Heamäe said.

By introducing flexibility, employers would get more candidates

Mets confirmed that a lot of people are talking about the possibility of flexible working and that flexibility on the part of employers would certainly ease their situation.

‘There are less than 900 people with reduced work ability among the unemployed in Pärnu County, but this is still a very large number, or nearly a third of the total number of unemployed, which was 2859 as at the end of the year. These nearly 900 people would all be very happy to have the opportunity to work part-time. By introducing flexibility, employers would definitely get more candidates,’ Mets said.

‘This topic requires a great deal of further introduction, because sometimes there is an attitude among employers that hiring a person with reduced work ability only means problems; but, in fact, anyone can have a reduced work ability without anyone else realising it. There are a lot of different people there nowadays,’ Mets admitted.

How can you find a new job in a changed labour market and what help can you get from the unemployment fund?

Technological advances have been frantic over the last decade and inevitably have had a major impact on today's labour market. As a result, employers are finding it increasingly difficult to find the right workforce.

However, the Unemployment Insurance Fund (Töötukassa) can help employers to find and recruit the labour they need. Livia Laas, Head of the Unemployment Insurance Fund (Töötukassa) Employer Services, explains where the sector's labour needs are greatest and how they can help employers recruit and develop new people.

Labour shortages, not unemployment, are more of a problem

There is no doubt that the corona crisis, which started last year, has hit the labour market hard. However, Livia Laas of the Unemployment Insurance Fund (Töötukassa) points out that while there is a lot of talk today about unemployment, the reality is that we have a much bigger labour shortage.

Job vacancies are showing a steady upward trend - since the second quarter of last year, they have only been on the rise.

"In terms of numbers, there are about 10 000 more unemployed people on the labour market now compared to the pre-crisis period, but it is worth pointing out that the unemployment rate was so low then that it was simply not possible to find new workers in these conditions," explains Laas.

One of the main reasons for the labour shortage is, of course, that the labour market has been undergoing increasing changes in recent years. For example, new technologies are increasingly emerging, which in turn require more specific skills and knowledge from the worker to work in their chosen field.

In many cases, the shortage is due to the fact that the sector is not popular with young people (e.g. toilets), which makes it difficult for employers to find replacements for people who leave their jobs. It is also more difficult in occupations where the overall level of pay tends to be low, but the nature of the work is difficult and tiring (care workers, customer services). There are also, for example, structural unemployment. "Jobs are often in places where there are no people with the right skills or where the location is simply not suitable for the person," says the head of the Unemployment Fund's employer service.

According to Laas, we have always been looking for more workers in the service sector, and at the moment we are looking equally for skilled workers and workers in the service sector. He also points out that several companies are already looking for help for the coming summer season, in addition to their existing workforce.

Teleworking has given employers wider opportunities

At the same time, since the introduction of stricter restrictions, teleworking has become increasingly popular both in Estonia and around the world. In some areas, this has also given employers greater opportunities.

If the majority of the work can be done from home, without the need to go to the office every day, employers can look further afield to find the right employee. "If an employer is looking for an employee in Harju County, telecommuting can actually bring someone from another county into the office," says Laas.

How can the Unemployment Insurance Fund help employers find a new employee?

Finding the right employee is becoming increasingly difficult and time-consuming. This is where the Unemployment Insurance Fund (Töötukassa), which offers a wide range of recruitment services, can help employers.

The first, and one of the easiest, ways to find a new employee is, of course, to place a job advertisement on the Unemployment Fund website. This is easy to do and completely free of charge for the employer. Every month, around 50 000 people look at job vacancies on our site. But the Unemployment Insurance Fund also offers a whole range of other ways to find the right job.

"Through the Unemployment Insurance Fund, you can organise, for example, information hours and open days where employers can tell you more about their jobs and what they do. It is also perfectly possible to organise events virtually. The Unemployment Insurance Fund organises a virtual job fair twice a year, which attracts around 35 000 participants and is a great place for employers to showcase themselves," explains Laas.

If, on the other hand, you have people but don't have the capacity to train them, the Unemployment Insurance Fund can help. "We have a special training support scheme where, for example, if new technology is introduced in the workplace, the Unemployment Insurance Fund will also support the upgrading of the skills of existing employees," says Laas.

Find out more about the different opportunities offered by the Unemployment Insurance Fund at www.töö

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