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    Names of mostly young people who recently went abroad in search for jobs and opportunities are written on tiles that cover a wall at a bus station in Imotski, southern Croatia. Youth unemployment rate increased to a record high of almost 30% in 2016.

    About the ILO in Croatia

    The good and not so good news: Decreasing unemployment and low labour market participation

    In the first five years after Croatia’s independence in 1991, the country experienced a dramatic one third drop of GDP because of the war. GDP only reached its pre-war level more than 10 years later in 2003. In the early 2000’s Croatia experienced a steady growth of economic activity with GDP growth averaging 4.5%. However, the unemployment rate remained high and labour force participation was low.

    Croatia was then again heavily hit by an economic contraction because of the Great Recession. The economic crisis led to a 13% decline of GDP (2009-14) which was the second largest contraction after Greece. The crisis also had its toll on the labour market. The unemployment rate doubled to 18% in 2014 (as compared to pre-crises level) and the youth unemployment rate increased to a record high of almost 30% (2016).

    After six years of recession the economy returned to growth after 2015. EU membership and the access to structural and cohesion funds also helped to support recovery. In the last four years, the recovery was robust and broad-based. However, Croatia is still not catching up with the rest of EU. The country’s GDP per capita stands at 63% (2018) of the EU average – the same value as 10 years ago. Continue reading