If you plan to hire employees for your Estonian company, it is useful to understand how the local labour market works. Labour market information can help you estimate salary costs, understand the availability of talent, and identify the skills and languages commonly found in the workforce. It can also help you understand whether there are labour shortages in your industry and where competition for employees may be higher. Before starting the recruitment process, review current labour market data and forecasts. This can help you make informed hiring decisions and better plan the growth of your business in Estonia.
Key indicators
- Average gross monthly salary: €2,215
- Unemployment rate (ages 15-74): 7.1%
- Working-age population with higher education: 41.2%
- People with at least basic digital skills: 62.5%
- AI use in population: 49.2%
Estonia has around 700,000 people participating in the labour market. As a member of the European Union and the euro area, Estonia's labour market is closely connected to developments in the wider European economy. Employment is spread across a range of sectors, including information and communication, manufacturing, construction, professional services, finance, healthcare, education, and public administration.
The labour market has changed significantly over the past decades alongside the growth of digital services and technology-based industries. Digital tools and online services are widely used in workplaces, and remote and hybrid working arrangements are common in many sectors. At the same time, traditional industries such as manufacturing and construction continue to play an important role in the economy.
Like other European countries, Estonia's labour market is influenced by economic conditions, demographic changes, and technological development. Labour market reviews and forecasts point to the continuing importance of digital skills, productivity growth, and adapting to changes in the structure of work. Population ageing and a declining working-age population are also expected to shape labour market developments in the coming years.
Workforce in Estonia
Education and skills
Estonia's workforce combines a relatively high level of education with strong digital skills. According to Statistics Estonia, 41.2% of the working-age population has completed higher education. Employers can find specialists across a range of sectors, including information and communication technology (ICT), engineering, business services, finance, healthcare, education, and manufacturing. The Estonian labour market has also evolved alongside the country's digital development, increasing demand for workers with technical, analytical, and problem-solving skills. Labour market forecasts indicate that digital competencies and the ability to work with new technologies will continue to grow in importance across different industries.
AI leap
In addition, Estonia continues to invest in developing future skills. One example is the TI-Hüpe or AI leap initiative, which aims to improve artificial intelligence literacy among students and support the responsible use of AI in education. The programme is part of broader efforts to prepare future generations for a labour market where digital and AI-related skills are becoming increasingly important.
Many employees in Estonia also have experience working in international environments. Combined with the country's widespread use of digital tools and online services, this can support employers looking for talent for technology-driven, remote, or cross-border business activities.
Languages spoken in the workforce
English is the most widely spoken foreign language in Estonia. According to Statistics Estonia, 67.4% of people aged 15-74 speak English as a foreign language. Other commonly spoken foreign languages include Russian (43.7%), Finnish (13.4%), German (9.1%), and French (2.0%).
The language skills required for a position depend on the industry, customers, and day-to-day responsibilities of the role. English is commonly used in international companies, technology businesses, and many professional service firms. In some positions, particularly customer-facing roles, additional language skills may be required depending on the target market or client base. When hiring employees, it is therefore useful to define language requirements based on the specific needs of the role rather than applying the same expectations to all positions.
Salaries in Estonia
According to Statistics Estonia, the average gross monthly salary is €2,215. However, salaries vary depending on the industry, role, location, and level of experience.
When planning to hire employees, it is important to consider salary expectations for the specific role rather than relying only on national averages. In addition to salary, employers should also account for employment-related taxes and other labour costs when preparing their recruitment budget.
The table below provides examples of average gross monthly salaries across different sectors to help you compare compensation levels in the Estonian labour market.
| Sector | Average gross monthly salary |
|---|---|
| Information and communication | €4,139 |
| Financial and insurance activities | €3,903 |
| Administrative and support services | €1,891 |
| Manufacturing | €2,057 |
| Professional, scientific and technological activities | €2,768 |
| Education | €2127 |
Source: Statistics Estonia
Labour shortages and talent availability
Finding employees in Estonia depends on the role, industry, and location. While some sectors have a larger pool of available candidates, employers may face stronger competition when recruiting specialists with specific qualifications or experience.
In recent years, labour shortages have been reported particularly in sectors such as engineering, healthcare, and education. These shortages are linked to factors such as technological development, changing skill requirements, and demographic trends. Conversely, some administrative, creative, and sales and marketing occupations may have more job seekers than open positions.
Labour market needs change over time, and occupations that are currently in high demand may not face the same conditions in the future. For this reason, it is recommended to review current labour market information before starting a recruitment process.
Useful resources include:
- EURES Labour Shortages and Surpluses: provides information about occupations experiencing shortages or surpluses across Estonia and Europe.
- Töötukassa Labour Demand Barometer: provides regional insights into labour demand and hiring trends in Estonia.
These tools can help you better understand talent availability and labour market conditions when planning recruitment.
Flexible and modern ways of working
Flexible working arrangements are common in Estonia, particularly in knowledge-based industries. Research shows that Estonia has a higher-than-average use of flexible working arrangements compared with many European countries, including flexible schedules, remote work, and other forms of work that give employees greater control over when and where they work.
Remote and hybrid work have become a normal part of working life in many sectors. Flexible working arrangements are particularly common in information and communication technology (ICT), professional services, financial services, and other knowledge-intensive industries where work can be performed digitally.
For employers, flexible working arrangements can support recruitment by allowing access to talent from different regions and helping teams collaborate across locations. The widespread use of digital tools and online services has also made it easier for businesses to manage remote and hybrid teams.