About the ILO in Montenegro

An advanced EU accession candidate with structural labour market challenges

Since its independence in 2006, Montenegro had to heavily invest into an expansion of government capacities to provide public services supplied before by the Federation with Serbia. In addition to this challenging political transition, the country also has to deal with an incomplete economic transition.

The Covid-19 pandemic hit the tourism-dependent economy particularly hard. GDP dropped by 15% in 2020. The pandemic also reversed the positive labour market trends from previous years. The employment rate decreased by an estimated 7% (from 61% in Q3 of 2019 to 53% in Q3 of 2020) despite several state support packages to protect jobs. As in other countries of Southeast Europe, employment losses mainly translated into rising inactivity rather than unemployment. The pandemic exacerbated the structural problems of the Montenegrin labour markets from before the pandemic, i.e. low employment and high inactivity, especially for youth, women, and the low skilled, as well as elevated levels of informal employment. Continue reading