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The coronavirus pandemic hit micro-businesses hardest in Serbia, causing a reduction in working hours during the second quarter of 2020, equivalent to the loss of 510,000 full-time jobs, according to a report by the EBRD and the International Labor Organization.
However, by offering “the most generous and comprehensive economic package among the Western Balkan economies”, the Serbian government has succeeded in curbing the “spread of poverty”. according to a new report European Bank for Reconstruction and Development (EBRD) and International Labor Organization (ILO).
After the introduction of strict public health measures and the consequent decline in economic activity, working hours in Serbia were reduced by approximately 14.8 percent during the second quarter of 2020. Shorter working hours and Offsets contributed significantly to this reduction.
If the health crisis continues and job retention programs cease, people could be pushed into unemployment, the study warns.
The report identifies sectors in which more than 700,000 workers are at immediate risk as the health crisis continues: wholesale, retail, accommodation, transportation, services, forestry and logging, agricultural and livestock production.
Of this workforce, about 314,000 are self-employed and there are more than 267,000 informal workers. To date, the crisis has hit microenterprises the hardest, employing more than 735,000 people, and at least one in four workers has lost their jobs.
The government provided its “most generous and powerful measure of financial assistance” in the form of retention subsidies, which for micro, small and medium-sized enterprises accounted for about 65 percent of total labor costs.
While the report welcomes “near universal support for business and citizens,” it also offers five preliminary policy recommendations:
• a more selective and specific approach to help the most vulnerable citizens,
• solutions to support a large number of circular and seasonal workers,
• mitigate the less visible social costs of a pandemic,
• optimization of the new youth employment program in Serbia and
• more consistent and effective use of social dialogue.
“This is an important report that highlights not only the impact of the coronavirus pandemic on the Serbian labor market and workforce, but also provides concrete and valuable advice on how to deal with the challenges it faces. We welcome the commitment of the Serbian authorities to participate in this process. “It is also encouraging for us to see how our advisory support greatly changes things where it has been implemented,” said Barbara Rambousek, Director of Gender and Economic Inclusion at the EBRD.
“At the regional level, we received a lot of positive feedback on these assessments of the impact of kovid-19 on the labor market and on how alternative policies are implemented in different settings,” said Marcus Pilgrim, Director of the ILO Office for Central and Eastern Europe . He added that “it is critical to provide policy makers and other stakeholders with robust data and quantitative analysis on which they can reason and ultimately design an exit strategy from their specific circumstances.”
In response to the coronavirus pandemic, the ILO Office for Central and Eastern Europe and the EBRD Gender and Economic Inclusion Team have established a joint working group to assess the impact of the crisis on the economies of the region through examining possible short- and medium-term effects on employment and the labor market.
The report on Serbia follows studies and recommendations already published for Montenegro and North Macedonia.
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