The economic crisis has hit Estonia hard. As this blog has noted, Estonia’s economic output declined at an annualized rate of 15.6% in the third quarter, and the country’s unemployment rate, at 14.6%, is a modern record for Estonia and the third highest in Europe. The only Estonian industry showing any growth at all is fisheries, and Estonian construction workers have fled to Finland in search of employment.
Today’s New York Times cites a new Moody’s report that compares a mainly European group of countries on the basis of a newly contrived misery index. This index adds together a country’s unemployment rate and its government budget deficit, calculated as a percentage of its gross domestic product. The resulting total represents the country’s misery index, which
captures the current conundrum for many countries: their economies need stimulus, but their budgets may not be able to afford it.
Estonia scores a misery index of about 18%, placing it between Portugal (less miserable) and France (more miserable) in the league tables. But Estonia is considerably less miserable than the United States and Britain, and far better off than misery leaders Spain, Latvia, and Lithuania (each close to 30%). View the complete tables here.
None of these countries is in great shape, but the figures suggest that the Estonian government has a bit more flexibility to implement economic stimulus measures than do its Baltic neighbors.
