Policy area

Labour and employment

Sustainable development goals and international commitments

Decent work and economic growth is one of the sustainable development goals under the UN Agenda 2030. The SDG 8 promotes entrepreneurship and job generation along with the measures to eradicate forced labour, end modern slavery and human trafficking. It aspires to achieve full and productive employment of men and women, as well as decent work for all. The SDG 5 – Gender equality, SDG 4 – Quality education (including life-long learning) and SDG 10 – Reduced inequalities help achieve the same results.  SDG 8 covers the achievement of full and productive employment and decent work for all women and men, including for young people and persons with disabilities, and equal pay for work of equal value (SDG 8.5) and substantial reduction of the proportion of youth not in employment, education or training (SDG 8.6).

The National Sustainable Development Strategy 2015-2030 nationalises sustainable development goals, including stimulating employability and social inclusion primarily through self-sustainable and balanced economic growth (goal 4.2.5). The NSDS recognises the need for establishing enabling social and socio-economic environment to prevent further negative demographic trends in the northern region (goal 4.2.8), which has a definite bearing on the labour supply and structure. Strengthening the business environment conducive to business growth and development, SMEs and investment (goal 4.4.7 Growth of Montenegrin economy competitiveness) aspires to boost job generation and employment. In addition, the issue of employment is also highlighted in the context of the need to foster employment of vulnerable groups, such as the Roma (2.1.3.6), persons with disabilities (2.1.5.2), as well as youth and the hard-to-employ.

Obligations in the EU accession process

An overview of obligations from negotiation chapters

Pertinent EU Acquis chapters for the labour policy are primarily Chapter 2 – Freedom of movement for workers and Chapter 19 – Employment and social policy. The employment and social policy Acquis sets the standards in the area of labour law, safety at work, equality and health. Particularly binding are the antidiscrimination rules on various grounds. EU employment and social inclusion policy is primarily supported through a specific financial instrument – the European Social Fund. Closing benchmarks for Chapter 19 include required amendments to the Labour Law and the Occupational Health and Safety Law, the non-discrimination legislation, and building administrative capacities (particularly through labour inspection, equality bodies and the Ombudsperson) to ensure their full implementation.

Freedom of movement for workers, one of the fundamental EU principles and one of the four freedoms within the EU internal market, is covered by Chapter 2. It enables EU citizens to work in other Member States and enjoy the same labour conditions, tax and social facilities as domestic workers. EURES, the European cooperation network of employment services, was launched to enable matching skills and vacant jobs in the EU labour market. Montenegro is getting ready to introduce the system that will be available to it upon accession. Montenegro received one closing benchmark for Chapter 2, namely, before accession it is to show it has adequate structures and capacities in place for proper implementation of the acquis on the freedom of movement for workers.

An outline of the EU strategic framework

Inclusive growth fostering high employment economy delivering social and territorial cohesion is one of the priorities set by the Europe 2020 strategy. To that effect, the EC proposed An agenda of new skills and jobs. It is aimed to modernise labour markets and empower people by developing their set of skills throughout the lifecycle with a view to increase labour participation and better match labour supply and demand, including through labour mobility. By 2020 the EC intends to increase the employment rate of the population aged 20-64 to at least 75%, including through the greater involvement of women, older workers and the better integration of migrants in the work force.

The European Employment Strategy dates back to 1997, and its main aim is the creation of more and better jobs throughout the EU. It now constitutes part of the Europe 2020 growth strategy and it is implemented through the European semester.

Political guidelines for the new EC refer to the need to ensure that every worker in the Union has a fair minimum wage and to support those who lose their jobs because of external events that affect the economy. The guidelines also refer to better implementation of the Work-Life Balance Directive (that should return more women to the labour market), and the need to turn the Youth Guarantee into a permanent instrument to fight youth unemployment.

Labour policy in Montenegro’s strategic framework

Montenegro aspires to economic development through labour market reforms to ensure having the business climate conducive to investments, generation of better jobs and increased employment (MGWP 2018-2020, priority 1). Increasing employment and reducing unemployment is set as the first priority of the National Strategy for Employment and Human Resource Development. It is intended to be achieved through improvements of the business climate, increased competitiveness and the economic growth as the main generator of increased employment. Over the period from 2014 to 2019 the employment rate increased (from 50% to 56%) and the unemployment rate decreased (from 18% to 15%). However, Montenegrin labour market is still burdened with a low activity rate (68% compared to the EU average of 74% in 2018); unfavourable age structure of employees; considerable regional disparities; employment of foreign workers during high tourism season. The long-term unemployment rate (11.5% in 2018) is pronouncedly high compared to the EU average (2.9%), which is particularly disconcerting given that the category includes hard-to-employ individuals.

Putting in place the assumptions for increasing employment should be accompanied by reducing disparities between the labour demand and supply, generating the workforce holding relevant knowledge and skills, as well as greater worker mobility (MGWP, priority 1). This is tackled under Priority 3 of the National Employment Strategy – Improved skills and competencies matching labour market needs. The issue of competencies is intrinsically linked with the education policy. Thus, the Development Directions stress the significance of matching the enrolment policy with labour market needs (commitment 17.1), the delivery of the Programme for Employment of Doctoral Students (17.2), but also further promotion of dual education and practical teaching at the higher education level. It should not be overlooked that an important segment in matching labour demand and supply is the concept of lifelong learning, adult education and career orientation as the gist of the active labour market measures (Priority 4 Strategy for Lifelong Career Orientation: Strengthen career orientation services for job-seekers and the employed).

MGWP and the Development Directions envisage improvements and financial strengthening of active labour market measures. As a matter of priority, skill development support programmes target long-term unemployed, women, persons with disabilities, and youth. The position of women in the labour market is being improved through targeted measures to support entrepreneurship and self-employment, available both at the national and at the local levels, which is also recognised as one of the Government priorities in the area of labour and social welfare, and is further elaborated in the Plan of Actions for Gender Equality and the Strategy for Developing Women Entrepreneurship. It is noteworthy that sector-specific strategic documents aimed at improving the quality of life of specific groups (e.g. the Roma, LGBT, PwD, minorities, youth) include the issue of employment among their specific objectives.

The Economic Reforms Programme 2020-2022 envisages as priority reform actions the increased participation in the labour market for particularly vulnerable groups of job-seekers and the adoption of the new National Employment Strategy 2021-2024. In its section on Smart Growth, the Development Directions sets among its priorities improved financial support and mentorship for micro, small and medium businesses (building entrepreneurial knowledge and skills), and expects as a result the strengthening of the MSME sector and increased job generation  in the sector by 4% compared to 2018. On the other hand, informal work is recognised as one of the challenges and this issue is addressed in the overarching strategy documents. Under MGWP goal 1, commitment 1.7 concerns combating informal work through further alignment of labour legislation. This is further elaborated in the National Employment and Human Resources Development Strategy (Priority 2 – Efficient Labour Market) stressing the need for well-balanced incentives, prevention efforts and sanctions, and the corresponding need to strengthen labour inspection.

Occupational health and safety is conducive to increased productivity and economic development, hence special attention needs to be devoted to certain risky sectors (construction, transport, agriculture), but also to more risk-prone categories of workers (pregnant women, workers under 18 years of age, persons with disabilities) with a view of reducing job-related injuries, occupational and work-related diseases, etc. in line with the Strategy for Improving Occupational Health and Safety.

The multidimensional nature of labour and employment policy is well illustrated by the close links with the agriculture and rural development policy that aspires to increase the number of young people employed in rural areas (MGWP goal 8 ), enabled through greater connections between agriculture and trade and tourism as the strategic industry. Balanced economic growth and increased employment are also affected by better infrastructure (MGWP goal 7) and investments in balanced territorial development (MGWP goal 3).

The challenges in this policy area are recognised in the EC 2019 Report on Montenegro. EC noted there is room to further reduce the discrepancy between the education system and labour market needs, and that there is the high proportion of inactive population and insufficient social dialogue. It stressed the need to shape more responsive employment policies based on a fuller analysis of labour market performance while also using a gender assessment of policies. Further actions are required to fight the grey economy and introduce better quality employment measures aimed at young people, women, minorities and other job seekers.

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