Western Balkans Labor Market Trends 2017

Labor markets in the Western Balkan countries, comprising Albania, Bosnia and Herzegovina, Kosovo, FYR Macedonia, Montenegro and Serbia, are characterized by low employment rates and high unemployment. High and persistent long-term unemployment has become a salient feature of the labor markets of the region. Substantial informal sector activities are another prominent feature of these economies. International migration plays an important role in cushioning the problem of unemployment and has become an important source of income. In addition, almost the entire region is facing an aging and shrinking population due to low birth rates and high emigration. Given these unfavorable demographic and labor market conditions, interest in labor market data and analysis features highly on the agenda of regional policy makers. This report focuses on the key labor market trends (activity, employment, unemployment) between 2010 and 2016, with a special focus on the link between economic growth and labor markets. The report starts by discussing recent economic developments (section two), which is followed by an overview of demographic developments and levels of activity and inactivity in the population (section three). Sections four and five discuss employment and unemployment respectively. Section six highlights the link between economic growth and labor market developments, and section seven presents a summary of the report’s findings. An extensive statistical annex on key labor market indicators for each of the countries can be found at the back of this report.