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SOME EMPLOYERS HAVE THEIR DOUBTS ABOUT MORE STATE INTERVENTION

State focuses on long-term jobless

CHANGES to training models, help for the long-term unemployed to get used to working again, social companies, more active help from agents in local labour offices: these are among the tools that the Slovak government says it will use to improve Slovakia's employment position. The revision to the law on employment services, which became effective on May 1, also aspires to foster the employment of disadvantaged groups such as the physically disabled or those with lower qualifications.

CHANGES to training models, help for the long-term unemployed to get used to working again, social companies, more active help from agents in local labour offices: these are among the tools that the Slovak government says it will use to improve Slovakia's employment position. The revision to the law on employment services, which became effective on May 1, also aspires to foster the employment of disadvantaged groups such as the physically disabled or those with lower qualifications.

While some employers are open to the cure offered by the government of Prime Minister Robert Fico, some firms responded that a healthy business environment, with limited administrative burdens, is the best way to boost employment.

Though unemployment in Slovakia dropped to an all-time low in April 2008, the country's more than 230,000 jobless still put it at or near the bottom of the European Union's unemployment rankings. Among the jobless, around 70 percent are classed as long-term unemployed.

"We cannot keep these people in some kind of lethargy on social subsidies, but must integrate them into the labour market, and use every tool to do so," the Deputy Labour Minister Emília Kršíková told a press conference in mid-May.

The European Union has been calling on member states to make an extra effort to allow their long-term unemployed access to labour markets, and adopt policies promoting the idea that "work in fact pays". Those who are unable to work should be guaranteed at least a minimum income as part of the European strategy for employment growth, Kršíková told the press.

According to Kršíková, this latest revision, which introduces a total of 16 new tools to activate the labour market, is part of Slovakia's obligation to prepare the nation for the transition to a knowledge-based economy.

The revision introduces additional help for the long-term unemployed and expands the definition of those who qualify as disadvantaged job seekers - or employees - in the Slovak labour market.

For example, the ministry added to this group those who have lost their job due to the restructuring of an organisation, while people who commute to work are now eligible for assistance, said Kršíková.
The state will provide three months' assistance to disadvantaged job seekers looking to enter the labour market. It will also help low-income employees to stay in their jobs by sharing some of their payroll tax burden for up to two years.

Labour offices will no longer require confirmation from the unemployed that they are seeking jobs, while the revision also creates a new position called "job agents", who will monitor employers' requirements for practical skills from future employees.

The revision will make it possible for the unemployed to participate in two consecutive so-called activation works, a government financed programme of temporary public works organised by local authorities, Kršíková told the media.

The law also creates so-called social companies, in which employees who are disadvantaged job seekers make up at least 30 percent of the staff. Social companies will receive support from the state to create and maintain jobs for them.

Ján Sihelský, general director of the Centre for Labour, Social Affairs and Family, said that, though statistics shows positive trends in the Slovak labour market, discussions with employers showed that the law needed to change.

While the Association of Employer Unions of Slovakia (AZZZ) has so far reacted positively towards the revision, the National Union of Employers (RÚZ) said that it is illogical for the state to pour more funds into active labour market policies at a time of falling unemployment.

"Support for the long-term unemployed and socially disadvantaged groups should be a priority, since plugging new employees into the working process partly eases the burden on the state budget and new resources are created in the social security system," Branislav Masár, the executive director of the AZZZ, told The Slovak Spectator.

According to Masár, the long-term unemployed represent a problem mainly for the state budget and the budget of the social insurer, which then influence the policies of the state. This risks the state proposing solutions and measures which might appear negative to employers, Masár added.

"We are positive that the revision renews the cooperation between labour offices and employees through committees for employment, which will operate at regional labour offices," Masár said.

But according to an official media release from the RÚZ, the union opposes the concept behind the revision to employment services since it re-introduces measures that have already been tried and proved ineffective. The document points, as an example, to the Sk40,000 subsidy for relocating for work.

"The draft revision eliminates the existing pressure on the long-term employed to join temporary public works or regularly report at labour offices and prove that they have been seeking jobs," reads an RÚZ statement, released during review of the draft.

Robert Kičina, executive director of the Business Alliance of Slovakia (PAS) said it is hard, at this point, to judge the effectiveness of the measures.

However, he said he is convinced that the business sector would be able to help solve the problem of unemployment more effectively if the state were to strive continuously to improvement the business environment and implement flexible business legislation.

"The government chose a different, more expensive and less effective way," Kičina told The Slovak Spectator. "I see solutions to the jobless rate unambiguously in improving conditions for business, specifically the creation of conditions that allow businessmen develop their businesses and create new jobs."

Education is the key

There is a need for changes to education and the preparation of job seekers for the labour market, said the Labour Ministry's Kršíková.

"We have to change the philosophy of education," Kršíková said. "In the past, education was provided regardless of whether the graduate was useful to the labour market or wasn't. Now we will purposefully prepare candidates for concrete jobs defined by employers."

Kičina of PAS agrees that the long-term unemployed represent a problem because they have low qualifications: they are not attractive enough to the labour market, and gradually lose their working habits.

"Entry into the labour market is very complicated for these people," said Kičina.

Also, businesses often complain about the lack of preparedness of graduates for practical work, said Kičina.

"However, young people are very flexible and this is why I think that among the unemployed they do not represent a problematic group and will find their place on the job market. The situation of the elderly is exactly the opposite, since their problems originate in lower flexibility," he added.
Martin Hošták, secretary of the National Union of Employers said that the long-term unemployed typically lose their working habits and find it very demanding to get back into the process of working.

"As far as high school graduates are concerned, the profiles of these people do not reflect the actual needs of the labour market," Hošták told The Slovak Spectator. "For example we have a lot of high school graduates but in fact a lack of qualified workers in the machine and automotive industries, or the construction business, which means graduates of specialised schools."

In terms of the age of job seekers, the employment of people older than 50 years depends on their education and skills just as it does for other applicants, he added.

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