Written by: Mateo Spaho
The labor market in Kosovo is facing one of the most serious challenges since independence. The latest data from the 2024 Population Census highlight a disturbing reality: over half of the working-age population is not economically active, while unemployment remains at 13.9%. This situation signals not only economic difficulties, but also deep structural and social problems.
Of the over 1 million citizens of working age, about 548 thousand are outside the labor market. This means that a large part of the country's human potential is unknown what it does! Is it located within the country or abroad? Does it plan to take up a profession? Inactivity at this level is among the highest in the region and represents a serious obstacle to the sustainable economic development of the country.
Even more concerning is the gender gap in the labor market. Some 65.4% of women are inactive, compared to 37.8% of men. This gap clearly shows that women in Kosovo face numerous cultural and economic barriers to entering the labor market. Moreover, even those who are active are more likely to lose their jobs than men.
Another major problem is the concentration of employment in a few limited sectors such as trade, manufacturing and construction. This narrow economic structure makes the economy fragile and dependent on sectors with relatively low added value. The lack of economic diversification, with limited agriculture and embryonic light industry, limits opportunities for quality employment and long-term development.
There is also a significant gap between official employment data and those from the pension contribution system. Tens of thousands of people do not pay contributions, indicating a high level of informality in the labor market. This not only damages state revenues, but also leaves workers without social protection and security for the future.
The consequences of this situation are multifaceted. A weak labor market encourages emigration, especially of young people, who seek better opportunities abroad. At the same time, dependence on remittances and consumption increases, instead of a productive and competitive economy. This creates a cycle that is difficult to break, where the lack of economic development further fuels unemployment and inactivity.
To address this situation, concrete and well-coordinated measures are needed. First, active policies should be designed to increase women's participation in the labor market. This includes investments in nurseries and kindergartens, flexible work policies, and combating gender discrimination in employment.
Second, it is necessary to diversify the economy. Investments should be directed towards sectors with high potential such as information technology, renewable energy and advanced manufacturing. This would create new jobs and increase the country's competitiveness.
Another important step is the formalization of the labor market. Institutions should strengthen controls and create incentives for businesses to declare workers and pay the relevant contributions. Formalization increases transparency and social security for citizens. Also, the education system should be more closely linked to labor market demands. Many young people complete their studies without the practical skills required by employers. Vocational education and practical training should receive more attention. Finally, support for small enterprises and startups is essential. These businesses have great potential for job creation, but often face a lack of financing and bureaucracy.
Kurti and those who will follow him must understand that there can be no patriotic Kosovo without a Kosovo rich in active and entrepreneurial citizens. If quick and decisive steps are not taken, Kosovo risks losing a large part of its population. The labor market is not only an economic issue, but the foundation of the country's social well-being and political and military stability.
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