engleski

Croatia: Time to Re-evaluate Employment Policy

The current situation on the Croatian labour market does not look very promising. Nonetheless, it seems that the global financial and economic crisis has only emphasised already existing problems. Croatia has the lowest employment rate among all EU countries, which, together with a two-digit unemployment rate, clearly indicates that there are internal structural reasons for this unfavourable situation. The main culprit for the lack of the necessary dynamics in the labour market flows is the labour demand. Faced with the absence of domestic and foreign investments, rigid employment protection laws and high tax burdens, it is almost impossible for firms to create new jobs and expand the overall labour demand. Thus, it seems that employment policies should help in this kind of situation. However, the assessment of employment policies in Croatia reveals that there are more weaknesses than strengths among internal factors, with some positive expectations amid the external factors which are connected with accession to the European Union. However, relying only on accession to the EU in a situation of reasonably unfavourable economic conditions in its member countries does not seem like the best strategy. In order to improve employment potential, Croatia should rely more on its internal strengths and institutional conditions.

employment policy, crisis, Croatia

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