A report from the University of Latvia indicates that Latvia is at risk of falling into a productivity trap due to a slowdown in productivity convergence with EU averages.
A recent report from the Productivity Research Institute at the University of Latvia highlights a concerning trend in the country's productivity growth, which is lagging behind the average levels observed in the European Union (EU). The report projects that, while Latvia's productivity increased by 2.8% in the first nine months of 2025 compared to the previous year, the overall dynamics have been sluggish in recent years. Additionally, in 2024, actual productivity levels in Latvia reached only 54.1% of the EU average, with purchasing power parity putting it at 72.8%, marking it as one of the lowest in the EU. This stagnation raises alarms about the economic future of Latvia.
