The public sector provides only 17.7 percent of total employment in Albania. The private non-agricultural sector accounts for 27.6 percent while the private agricultural sector has a 47 percent share
TIRANA, June 1 – Albania’s public sector cut another 400 jobs in the first quarter of this year to register the lowest number of employees in the past two decades, according to the latest employment report by the country’s Institute of Statistics, INSTAT. At the end of 2011, the public sector had 165,000 employees compared to 191,000 in 2000 when major enterprises were still state-owned and the public administration was overstaffed.
In March 2012, the number of public sector employees was further cut to 164,600 down from 165,400 a year ago mainly because of redundancy reforms in several state owned sectors. In its 2012 budget, the Labour Ministry said an additional 3,000 people working in state-owned enterprises scheduled for privatization but also in public sectors would be laid off this year. The cuts affect current employees in Albpetrol oil company, which is 100 percent state-owned and is under privatization, workers in the former Distribution System Operator (OSSH) as well as in Albtelecom, whose minority stakes remain state-owned. Cuts will also be made in the public education and health sectors as well as the military forces and the dilapidated railways company. The latter costs the state budget around 5 million dollars annually.
Detailed INSTAT data show the majority 61,600 or 37 percent of total employees in the state sectors are included in the specialist category. Technicians and assistant specialists rank second with 25 percent, followed by workers. The “lawmakers, senior officials and director” category had 12,580 employees at the end of 2011. While all categories of employees have undergone cuts during the past seven years, specialists are the only category to have registered a significant 10,000 increase in employment numbers.
The public sector provides only 17.7 percent of total employment in Albania. The private non-agricultural sector accounts for 27.6 percent while the private agricultural sector has a 47 percent share.
Privatizations have played a key role in the cut of public sector employees.
The Albanian government has collected a total of around 90 bln lek (USD 833 mln, Euro 632 mln) from the privatization of state-owned assets since the early 90s when the country’s 47-year communist regime collapsed, according to a study carried out by the Open Data Albania research centre covering the 1993-2011 period. The study based on Finance Ministry data shows that most privatization revenues were collected during the past decade from the sale of key assets in the banking, telecommunication and energy sectors.
Private sector
Private companies hired only 1,305 people in the first quarter of 2012 compared to Dec. 2011. The number of people employed in the private non-agricultural sector is reported at 262,000. Detailed INSTAT data show trade is top employer in Albania with 65,000 people at the end of 2011. Second comes the processing industry dominated by textile and footwear enterprises with 63,000 people. The construction industry, once the key driver of the Albanian economy, now employs only 35,000 people from 52,000 in 2007 when it went into crisis.
Facing lower domestic and external demand, almost all major industries in Albania cut their staff and froze wage increases in 2011, according to short-term statistics published by the country’s state Institute of Statistics, INSTAT.
Unemployment rate
Although often prejudiced as unrealistic by experts and opposition MPs, INSTAT data show early 2012 registered a slight increase in unemployment rate. INSTAT reports the jobless rate rose by 0.03% compared to the final quarter of 2011 but was down 0.11% year-on-year.
INSTAT data are often criticized as unreliable due to the methodology calculating people living in rural areas possessing land as self-employed and taking into account only those people who register themselves as unemployed with state agencies.
INSTAT says the number of jobless people rose by only 471 people to 143,421 at the end of March 2011.
Albania’s official jobless rates are slightly higher compared to more prosperous Croatia, Turkey, Montenegro, but three times lower to also EU potential candidate Bosnia-Herzegovina, 2.3 times lower compared to neighbouring EU candidate Macedonia, and almost twice higher compared to Serbia, all of which have a higher GDP per capita compared to Albania, according to the EC and Eurostat, the statistical office of the EU. According to INSTAT, only 6 percent of the total registered jobless people benefit unemployment assistance of 6,850 lek (64.5 USD), which is enough to keep only a single person below the poverty line of USD 2 a day.
Full social assistance for a household stands at 4,195 lek/month (Euro 30), having increased by 172 lek for 2011. INSTAT data show the minimum monthly wage stands at 20,000 lek (Euro 145) under a mid-2011 decision while the average state pension stands at 12,000 lek, and village pensions at 5,650 lek.
The high level of informality, at an estimated 30 percent of the GDP, remains a top issue, at a time when even registered businesses pay social security and health contributions for only few of their employees, further widening the deficit in the pension scheme.
Labor Ministry data show the majority of registered unemployed people are jobseekers who have only finished compulsory education. Slightly more than 62,000 others have finished high school while only 3,763 unemployed people were reported to hold a university degree. A considerable number of registered jobless peopleנsome 9,000נare minors aged from 15 to 19 years old, followed by the age group of 21 to 34 years with 52,560 jobseekers. What’s characteristic about the Albanian unemployment rate is that during the past 10 years it has been dominated by long-term unemployment which ranged from 89.6 percent in 2000 to an average of 92 percent until the end of 2009, INSTAT says.
