The private sector has been the key driver of job creation during the past ten years while some 26,000 jobs have been cut in the state sector mainly due to privatizations in key sectors
TIRANA, June 4 – With employment being on top of the agenda during this electoral campaign, the major two parties running for the June 23 general elections promise to create between 250,000 to 300,000 jobs in the next four years which under current employment trends and global crisis impacts seems a mission impossible.
In its second consecutive term during the past four years the ruling Democratic Party-led coalition was able to create only around 67,000 jobs, according to official data by the Institute of Statistics (INSTAT). During its first 2005-2009 term, only 42,000 jobs were created. The private sector has been the key driver of job creation during the past ten years while some 26,000 jobs have been cut in the state sector mainly due to privatizations in key sectors during the 2000-2011 period, according to INSTAT data.
Latest INSTAT data show Albania had an unemployment rate of 12.8 percent, around 142,000 jobless people, at the end of the first quarter of 2013. The opposition Socialist Party and labour unions claim the unemployment rate is far higher.
INSTAT estimates some 522,300 people, which is around half of Albania’s total labour force, are employed in the private agricultural sector under a controversial method calculating all people possessing land as self-employed in the private agricultural sector.
Prime Minister Sali Berisha has promised his Democratic Party will create 250,000 jobs based on the favourable business climate with a 10 percent flat tax on personal income and corporate taxes.
Meanwhile, opposition Socialist Party leader Edi Rama says the Socialist Party will create 300,000 jobs under its “Renaissance” programme reforming the country’s economy and applying progressive taxation on personal income tax and keeping the 10 percent tax on company profits unchanged.
Albania grew by only 1.6 percent in 2012, down from an average of 3 percent from 2009-2011 and an average of 6 percent during the pre-crisis years.
Unemployment unchanged at 12.8%
Latest INSTAT data show the unemployment rate in the first quarter of 2013 remained unchanged at 12.8 percent in the first quarter of 2013 down from 13.1 percent in the first quarter of 2012. The number of officially registered jobless people grew by only 184 compared to the final quarter of 2012 and was down by 1,482 compared to the first quarter of 2012, unveiling the poor confidence jobless people have in employment agencies to find a job.
While the public administration jobs remained unchanged at 164,000, the private sector hired 2,905 people compared to the final quarter of 2012 and around 19,000 more compared to the first quarter of last year. Average wages in the public sector rose to 51,700 lek, up from 48,800 lek in the first quarter of 2012. Compared to the final quarter some 693 people have been removed from the unemployment assistance scheme. Some 8,345 people benefitted monthly unemployment assistance of 6,850 lek at the end of the first quarter of 2013.
INSTAT has recently revised downward the unemployment rate for the final quarter of 2012 to 12.8 percent down from 13.26 percent early last March based on the new population census in 2011 which showed the population had shrunk by 7.7 percent to 2.8 million people in the past decade.
INSTAT has also revised upward the number of people employed in the private agriculture sector to 522,300, up from 485,408 in the third quarter of 2012.
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.
Employment by sector
The services sector employs 37 percent of people aged between 15 to 64 years old. Employment in market services such as trade, transport, financial activities, hotels and restaurants and car repair, communication and real estate accounts for 21 percent of total employment, according to INSTAT. The public services composed of public administration, security, compulsory insurance, education and health accounts for 16 percent of total employment.
Employment in the agriculture sector in 2011 accounted for 44 percent of total, compared to 19 percent in the industry sector.
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.
While construction and extractive industry are dominated by male employment, the manufacturing industry mainly involving garment and footwear manufacturing is dominated by women. Women employed in the public services slightly dominate over men, mainly because of having a majority in the education and health sectors.
More discouraged workers
Albania’s unemployment rate, the share of labour force aged from 15 to 64 that is unemployed, slightly rose to 13.9 percent in 2011, up from 13.8 percent in 2009, according to the newly published 2011 labour force survey conducted by state Institute of Statistics. The long-term unemployment rate, the share of labour force that is unemployed for 12 months and more, also rose to 10.2 percent, up from 9.1 percent in the previous 2009 survey.
INSTAT justifies the finding that 21.5 percent of youth aged from 15 to 29 years old are unemployed with the school attendance of the majority of youth from this age group.
Around 13 percent of the economically inactive population said they were not looking for a job because they believed there was no available work. Some 7.2 percent of young men and women aged between 15 to 29 years old consider themselves as discouraged workers, compared to 20 percent for the age group of 30 to 64 years old. Some 7,300 households nationwide were interviewed for the 2011 labour force survey which was based in the 2011 housing and population census.
