Focus area
The medium-term (5 years) and long-term (15 years) labour market forecasts have been provided since 2009 and are updated once every two years by the Ministry of Economics. The labour market forecasts are based on economic development and demographic scenarios and support an early anticipation of future labour market mismatches. The forecast reports include analysis of key trends in the labour market development and contain labour market prospects disaggregated by sector, occupation and education level.
Implementation level
At what level is the initiative implemented?
Starting period
TIMESPAN: In what year did the initiative commence?
PERSPECTIVE: is the initiative based on evidence derived from skill forecasts or foresight activities?
The medium and long-term labour market forecasts are formed on evidence derived from skill forecasts based on scenarios developed by the Ministry of Economics.
Policy area
To which POLICY AREAS(s) does the initiative apply?
How it is funded?
Funded by national government

Skill mismatch

Skill mismatch target
What type(s) of skills MISMATCH does the initiative aim to addresses?
Skill shortages (employers cannot fill their vacancies due to a lack of skills in the labour market)
Skill gaps (worker's skills are below the level of proficiency required by their employers and jobs)
Skills matching focus
How does  the initiative address skills mismatches?
The forecast provides information on changes in the labour demand by occupational groups. The inner logic of the forecast model is based on the concept of the labour market general equilibrium, i.e. the labour force demand and supply balances in various labour market segments over a longer period of time.
The forecast provides information on potential labour market mismatches in the future. The forecasting model consists of three blocks: demand block, supply block, and the labour market block, which are all interrelated and mutually complement each other.


What methods of undertaking skills assessments and / or skills anticipation does the policy instrument utilise?
Skills forecasting
The dynamic optimisation model is used in producing the forecast. The medium-term (5 years) and long-term (15 years) forecasts are provided.
Use of skills intelligence
How is labour market information / skills intelligence used within the initiative?
The “Guidelines for interpretation and use of medium and long-term labour market forecasts” have been developed primarily to support the consultants working in educational provision and career management.
The forecast is used by policy makers to shape policies or measures in employment and education policies.


Main responsible body
Main body or organisation with overall responsibility for the initiative.
National ministry
Ministry of Economics
Other involved organisations
Which other organisations have a role in the initiative?
National ministry
Ministry of Education and Science provides education related data which is used in producing the forecast
National PES
National Employment Agency provides employment related data which is used in producing the forecast
Research centres, universities
Riga Technical University took part in elaboration of dynamic optimisation model structure and existing forecasting methodology.
Central Statistical Bureau provides basic statistical data on workforce, economic activity, education etc.
Who are the intended beneficiaries?
Young people making the transition from education into work
Forecasts serve young people when choosing their future educational and professional paths.
The main target group is policymakers. The forecasts are the quantitative basis for further discussions among employment, education and structural policy makers, social partners, scientists and other stakeholders, in order to prepare and adapt the expected structural changes in the national economy in a timely manner.


Success factors
SUCCESS FACTORS in the implementation
The initiative targets policy makers and the results of the forecasts are regularly presented and discussed with the Ministry of Education and Science, and with experts from other governmental institutions and social partners.
BARRIERS in the implementation
The Ministry of Economics recognises that there are limited possibilities to disseminate labour market forecasts and lack of information channels (e.g. public discussions about the future trends and needs of the labour market) and the there is a lack of coordination mechanisms to ensure the inclusion of labour market forecasts in policy documents, including education policy.
Monitoring and evaluation
MONITORING and EVALUATION: Is progress measured regularly? What are the indicators used to measure progress of the policy instrument? Have any evaluations been conducted?
The Ministry of Economics produces annual reports on the use of the forecast results, for example, in initiating additional in-depth workforce analysis in selected sectors or in addressing specific target groups, such as low skilled adults. The feasibility study for establishing a comprehensive system of anticipating changes in the labour market included a section on recommendations for improving the forecasts. No other specific evaluations have been conducted.
UPDATES: whether there have been any major updates of the initiative since it has been implemented?
There have been updates in the methodology to improve the quality of the forecast. The Dynamic Optimisation Model Latvia uses was first developed in 2007 and extensively modified from 2010-2013 within ESF co-funded project ‘Development of Medium term and Long Term Labour Market Demand Forecasting System’.
EVIDENCE ON EFFECTIVENESS: How effective is the policy instrument?
It has been recognised in the reports on forecasts that there is a need to improve dissemination of the results of the forecasts and the understanding of their use.
SUSTAINABILITY: How sustainable is the policy instrument? Do you expect the instrument to continue over the next few years and why?
The skills forecasts are expected to continue. State Employment Agency in cooperation with the Ministry of Economics is working on establishing a comprehensive system of
anticipating changes in the labour market, where Ministry of Economics will remain in charge of the platform for qualitative medium and long-term labour market forecasts.

Other instruments in Latvia