‘The Croatian Economy Has Indeed Started to Restructure’

Despite high unemployment, evidenced by more than 350 thousand people registered at the employment office, trends in the labor market indicate that the Croatian economy has indeed started to restructure, emphasized today the Assistant Minister of Labor and Pension System Tatjana Dalić.

This year, a record number of 41 thousand people were involved in active employment policy measures, and over 180 thousand people were employed from the records of the Croatian Employment Service. Additionally, data from the Croatian Pension Insurance Institute (HZMO) shows that in September, as many as 42 thousand people were employed, or 1,360 people daily, said Dalić at a conference dedicated to local partnerships for employment.

At the same time, the number of people registering at the employment office has significantly increased, and the simultaneous rise in employment and unemployment shows that the Croatian economy has begun the restructuring processes, says Dalić.

In restructuring, the employer lays off part of the workers no longer needed due to changes in the business process and hires new workers with new skills.

Currently, layoffs are still greater than hiring, so the number of unemployed is rising, and when economic growth finally begins in Croatia, it will take another six to nine months to see this reflected in a decrease in unemployment, adds Dalić.

The Assistant Minister also highlighted the success of seasonal employment, which has increased by 25 percent compared to last year, and even 50 percent compared to the years before the crisis. This shows that Croatian tourism has prospects even in times of crisis and recession, and the Ministry of Labor is preparing to propose a series of new incentives for seasonal work and for employers in difficulty in 2013.

Advisor at the Croatian Chamber of Economy (HGK) Davorko Vidović warned of the “myths about employment,” such as the one that investments alone increase employment.

This was proven incorrect by the example of Sisak, where around 500 million dollars (steelworks, thermal power plant, refinery) has been invested in recent years, yet the number of employed has decreased.

Vidović emphasizes that the issue of employment and unemployment must be the top priority in Croatia, both at the state and local levels, and sees particularly great potential for employment in local infrastructure, in which local partnerships for employment must play an important role.

At the conference, a call for proposals for the allocation of non-repayable funds “Local Initiatives for Promoting Employment” was presented, through which projects worth 1.8 million euros will be financed, with the allocation of funds expected in the first quarter of next year.

The second phase of this call, amounting to 4.5 million euros, was also presented and will be announced in mid-second quarter of 2013.

The conference ‘Local Partnerships for Employment – New Role for New Tasks’ was organized by the Ministry of Labor and Pension System and the Croatian Chamber of Economy.