Croatian employment rate higher than pre-crisis levels

November 9, 2021 – We are now in the part of the year where the classic seasonal drop in the Croatian employment rate typically occurs, but due to the pandemic and some of the trends it has created, things are showing up a little different.

As Poslovni Dnevnik / Jadranka Dozan writes, due to a slow but steady national economic recovery, Croatia’s total employment rate has exceeded the pre-pandemic-induced crisis situation. The recovery in employment and demand for workers is currently overshadowed by a parallel process of increasing the number of voluntary liquidations and the opening of bankruptcies of companies which no longer see any prospect for the continuation of their activities, which has been going on since the second trimester. of the year.

Likewise, unlike Croatian employment, which has improved compared to pre-pandemic figures, the number of unemployed is even higher than it was at comparable levels last year, Croatian National Bank analysts pointed out in a new review of economic trends.

This, they say, indicates increased employment of workers from countries outside Croatia and the EU in order to partially offset the growth in demand for labor.

The growing demand for labor is also suggested by the value of the index by which the Zagreb Institute of Economics monitors its current situation through online job vacancies, and the EIZ has accompanied it. of the headline “looking for more workers” and commenting that the data “still offer grounds for optimism”.

This is the OVI index (Online Vacancy Index), which was developed by the Institute in cooperation with the MojPosao portal (MyJob) and which, last October, indicated a higher demand for work compared to the last year, but also compared to that of the level of 2019. The demand for labor measured by this index is, according to them, about 39% higher than it was in October 2020 and about 9% higher than that of October 2019 before the pandemic.

Last month was the sixth in a row that demand for labor in Croatia exceeded the months before the pandemic, and in October of this year, retail workers, waiters, teachers, chefs and warehouse workers were the most in demand, commented on the OVI Index. Almost half of the advertised vacancies were linked to a fixed-term contract, as well as an increase in the number of advertisements in which the possibility of working from home is explicitly mentioned.

In recent days, the employment campaign of Novigrad Laguna, which manages 13 hotels, 4 camps, a settlement of 80 villas, as well as 92 apartments in Novigrad, on Krk and Korcula and the Peljesac peninsula, has drawn particular attention. . As part of the preparatory activities launched for the next tourist season, Aminess hotels and camps have launched a campaign to attract up to a thousand employees, offering them stimulating monthly rewards, Christmas bonuses, accommodation in a modern hotel for employees, a hot meal, as well as education programs in which, in 2022, they intend to invest nearly one million kuna.

In the business world, the high demand for workers in Amness hotels and camps is partly linked to unofficial reports that the company is about to acquire a new hotel in Makarska.

Zrinka Bokulic, Chairman of the Management Board, neither confirms nor denies this information. She says the campaign reflects several main things, from business expansion (in terms of existing capabilities) and potential new acquisitions to increasing service quality standards, especially in Orebic and Korcula, which are not only recently under the auspices of the company. The new level of service standards, in addition to education, includes a larger number of employees.

After this year’s pre-season, a good summer season seemed unlikely, so part of the accommodation capacity opened a bit later, and Valamar has already turned to preparations for 2022. A fortnight ago , they have announced their intention to hire approximately 400 key seasonal workers. indefinitely this fall, and will provide them with a stable income and year-round work in tourism.

While the main companies in the Croatian tourism scene are doing everything to ensure the highest quality service for the next year, the problem of the lack of skilled labor is one of the reasons for the lower expectations of the companies in the October survey conducted by the Croatian National Bank. .

Across all industries, the Business Entity Confidence and Optimism Index last month was lower than the average for the previous three months. In terms of construction and industry, the problem of labor shortage is most often highlighted, while in the survey of the Croatian National Bank, respondents from service industries mainly fear a lack of demand. .

Looking at the national labor market as a whole, at the end of September this year 1.6 million insured persons were registered with the Croatian Pension Fund. This is a slight decrease from the previous month, but to the annual level of 51,000, or 3.3% more, and it also exceeded the number of insureds recorded before the pandemic of September 2019, by more than 14,700 or a little less. than one percent.

While manufacturing and trade as the activities with the most employees recorded an increase over last year, but not up to pre-crisis figures, the construction sector and IT (Information and Communication category) has already passed them. Croatian IT companies are also exposed to more pronounced pressures on wage growth and, according to the latest available data from CBS, they are the ones driving average wage growth.

Despite the general trend of wage growth, demand for workers and more employees compared to pre-pandemic figures, the Croatian National Bank’s surveys of citizens in October showed a decline consumer optimism. The acceleration of inflation and the epidemiological situation obviously raise concerns about the future development of the labor market.

To learn more about Croatian employment, be sure to check out our dedicated business section.

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