engleski

Regional differences in long-term unemployment in Croatia

Similar to other transition economies, Croatia has since the 1990s experienced high unemployment rates that at the same time exhibited persistent regional differences. One of the key factors contributing to the unemployment persistence is the long-term unemployment. The share of the long-term unemployed in Croatia was throughout the transition high, and since the long-term unemployed through time lose the contact with the labour market institutions, their employability chances diminish and the unemployment problem taken as a whole persists through prolonged period of time. This scenario on the national level is even more pronounced in lagging regions. Croatian regions differ not only based on the gravity of the unemployment problem, but also on the structure of economic activity (with the strongest example being tourism along the coastline) as well as the obtained level of the development. Regional structure of the long-term unemployment problem has so far not been emphasized in the literature dealing with labour market problems in Croatia. Previous studies have revealed that the regions suffering from high unemployment rates are at the same time the regions that in GDP levels lag behind the more successful regions. The question is whether this finding extends itself to the long-term unemployment pattern as well. Using the Labour Force Survey data for the regional labour market indicators, the relationship between the long-term unemployment and the overall economic performance in region is analyzed. The aim of the paper is to investigate the distinction between the regions that were able to adjust faster to the changes in transition process (with emphasis on the labour market) and the regions that are lagging behind. In addition to the long-term unemployment itself, other indicators on regional level such as the educational attainment of the long-term unemployed, structure of the long-term unemployed according to their job-search activity pattern and the unemployed home-ownership are also analyzed.

long-term unemployment; regions; Croatia

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