Cyprus is among the EU member states that recorded the highest increases in labour productivity in the fourth quarter of 2025, with a growth rate above 2%, according to the European Commission's quarterly review of the Employment and Social Situation in Europe, published by the Directorate-General for Employment, Social Affairs and Inclusion.
Across the EU as a whole, labour productivity grew by 0.8% year-on-year in the fourth quarter of 2025, with the largest increases recorded in Lithuania, Poland, Cyprus and Malta.
The EU employment rate reached a historic high of 76.3%, approaching the bloc's target of 78% by 2030. Nine member states met or exceeded their national targets, with the largest improvements recorded among women aged 55 to 64. The sharpest deterioration, by contrast, was seen among women aged 15 to 24, where the rate fell by 0.4 percentage points.
Despite heightened uncertainty, employment expectations showed signs of stabilisation, with the relevant index rising by 1.5 percentage points between September 2025 and February 2026, though it remains below its long-term average. The highest expectations were recorded in Greece, Spain and Bulgaria, while the lowest were in Belgium, Austria and Germany.
Unemployment held at historically low levels, falling to 6.0% in the fourth quarter of 2025 and to 5.9% in February 2026, though small increases were recorded among young people aged 15 to 24 and among older men. The job vacancy rate stabilised at around 2%, reflecting continued labour shortages, particularly in construction and in administrative and support services.
Inflation stood at 2.1% in February 2026, edging up slightly from January, with preliminary estimates for March pointing to a further rise to 2.5%, driven primarily by changes in energy costs. Real gross household disposable income rose by 1.1% in the third quarter of 2025, supported mainly by growth in employee compensation, though reductions in net social benefits limited the overall increase.
The review also identifies differences in workplace priorities depending on education level and age. Workers with lower levels of education place greater emphasis on job security and pay, while those with a third-level qualification attach more importance to learning opportunities and the ability to take initiative. Younger workers prioritise learning more strongly, while pay and job security remain shared priorities across all age groups.
Source: CNA