Italy's Q1 2026 labour market hits record employment but sees rise in inactive workers

In the first quarter of 2026 Italy’s workforce reached a historic 24.2 million employees, the highest level since 2004, while the unemployment rate fell to a record low of 5.3 %. The growth is almost entirely driven by self‑employed and freelance professionals, who added roughly 72 000 workers, whereas permanent‑contract employees declined by about 13 000 and temporary hires rose only marginally. At the same time, the number of inactive people aged 15‑64 who have stopped looking for work increased by 44 000, signalling a deepening structural weakness in the labour market. Gross domestic product grew modestly by 0.3 % and total hours worked rose in line with that increase. The cost of full‑time labour rose 3 % year‑on‑year. Analysts note that the surge in autonomous work raises concerns about tax compliance and social protection, with fiscal authorities flagging low tax adherence among self‑employed workers.