Functioning labour market. Background and Description The quality of human resources and efficient labour market represent the key features of non-price competitiveness. In particular for a small and open economy as the Czech Republic is, the flexibility of labour force and harmonizing the supply and demand in the labour market represent important tools for dealing with the lost cost advantage which was such an important factor of growth before the start of the economic recession. The Czech labour market is affected by unfavourable economic development. Employment in the Czech economy dropped by 112 thousand jobs in 2008-2012.11 The biggest drop in employment (as absolute value) was suffered by the processing industry where in 2008-2012 the number of jobs decreased by nearly 80 thousand; construction lost further 56 thousand jobs and sales and transport lost 35 thousand jobs.12 One of the factors of the growth of unemployment is also the regional economic structure and its economic performance. The development stated above resulted in a rapid growth of unemployment. In September 2013, more than 550 thousand unemployed were registered; compared to June 2008 when the number of unemployed dropped below 300 thousand, this represents an increase by nearly 90%. The registered unemployment rate reached 9.4% at the end of 2012. More than 192 thousand unemployed have been registered for more than a year; in 2008–2012 this number increased by more than 90%. There is a risk of an increasing structural character of the unemployment, which would require difficult and costly solutions. Even though in the global context, the situation in the Czech labour market is still fairly good, the reality for some groups of the population is significantly worse. Persons aged 50+, disabled people and ethnic minorities, in particular the Roma, face higher risks of unemployment and loss of jobs. With regard to the employment rate of older persons (49 %13) the Czech Republic is at the EU average, however there is a significant difference between men (60%) and women (39%). The level of employment of persons with primary school education and without education is significantly below the EU average (in 2012 it was lower by 13.6 p. p.) and it is still decreasing. The level of employment of young people (20–29 year-olds) has also been showing a downward trend in the long term (in 2000 it was 66%, in 2012 only 57.8%) and their unemployment grows proportionally. The proportion of young people outside the labour market or without education is still below the EU average, however even this number is growing (8.9% in 2012). The Czech labour market is 11 Data source: CZSO: Time sequence of basic indicators of the Labour Force Sample Survey, 2013. Online at: xxxx://xxx.xxxx.xx/csu/xxxxxxx.xxx/i/prumysl_energetika 12 Data source: CZSO: Labour Force Sample Survey, 2013. Own calculations. 13Data sources in this part of the analysis: CZSO: Labour Force Sample Survey, 2013. Own calculations. specific due to the significant difference between the employment of men and women. The gender employment gap, i.e. the difference between the employment of men and women is 17.5 % (as opposed to the EU average of 12.2 %). Women in the Czech Republic face the most severe drop in employment connected to motherhood and raising children in Europe, mainly due to the insufficient availability of child-care services linked to the low use of part- time employment (according to OECD data, the Czech Republic has the lowest employment of women with children up to 12 years of age out of all EU Member States, of that the minimum employment of women with children below 3 years of age). Despite the complex development in the labour market in the Czech Republic there are still industries where the rate of employment is on the increase. These are often industries that are knowledge-based and high-tech (architectural and engineering services, IT services or production of electronic and optical devices), however their development is slowed down by poor accessibility of qualified staff and the level of discrepancies between the competencies of the workforce and employers´ requirements. This issue must be addressed both at the national, regional and local levels of the labour market and also in terms of education, by utilising the potential of the workforce within the territory in relation to support of education in the relevant fields. The Strategy for Inclusive, Smart and Sustainable Growth ("Europe 2020") pays a lot of attention to increasing the rate of employment. The National Reform Programme, following up Europe 2020, has determined several objectives for the Czech Republic for the area of employment. Despite the difficult situation in the labour market, the employment rate of women, older persons and the overall employment rate have increased since 2010. The biggest problem is the growing rate of unemployment of persons with low qualifications (see table at the end of the chapter). Territorial differences The labour market develops differently in each region. On one hand, there are "growth poles" in the Czech Republic – centres and regions where the employment rate is growing, and on the other hand, there are structurally and economically weak regions with growing unemployment. The potential for growth and improvement of the situation in the labour market at regional and local levels is mainly in the centres where there are high-tech and knowledge-based industries. Whilst Prague, South Moravian and Central Bohemian Regions have recorded an increase in employment since the recession, other regions have recorded a drop.14 The registered unemployment rate was kept below 5% only in Prague, while in 8 out of 14 Czech regions it exceeded 10% at the end of 2012. In those regions, the ratio of the number of the unemployed to job vacancies is very unfavourable. The registered unemployment rate of young people aged 15-24 was the highest in the Northwest region. In 2012, it reached 28.2%, which is roughly 9 p.p. above the Czech Republic average. What´s more, the figures are growing. The share of employed people under 34 years of age and the share of employed people over 55 years of age shows only small differences in the territory. On the contrary, the share of people employed and unemployed "without education" shows significant inter-regional differences. The development in Prague and South Moravian region (where the employment rate is driven mainly by Brno) but also in other regional centres demonstrates growing labour market differences between towns and rural areas. Job applicants in rural areas account for, approximately, one quarter of all applicants, while vacant job positions in rural areas represent only one sixth of all vacant job positions. There are less jobs created in rural areas 14 Data sources in this part of the analysis: CZSO: Labour Force Sample Survey, 2013. Own calculations. due to several reasons - mainly lower-quality infrastructure for business and lower availability of capital. Due to the lower density of population (and facilities) in the rural areas, the starting and especially the operation of business activities are mostly associated with higher costs. In terms of active labour market policy (ALMP), the activities of the Labour Offices at the level of districts and regions show major territorial differences in terms of the volume of funds expended on ALMP and the volume of requalifications, determined by the level of the registered unemployment rate. The lack of job opportunities in rural areas is one of the main reasons why young people, in particular, migrate to towns. To stabilize the rural population by securing job opportunities is one of the major challenges of the new programming period. It is of key importance to increase the competitiveness of enterprises in the rural areas, including the competitiveness of agricultural entrepreneurs who represent important employers in the areas. Other job opportunities can be created by diversification of their activities. The support will be aimed at: • territories with high unemployment, • economically weak regions (according to the Regional Development Strategy of the Czech Republic for 2014-2020) • NUTS II regions where the unemployment rate of persons aged 15-24 exceeded 25% in 2012 • territories with a need for a systemic solution to restructuring the traditional industrial regions. Experience from the 2007–2013 programming period and the state of achievement of objectives With regard to the labour market the activities of the 2007-2013 programming period sought: ⮚ to increase the skills of the workforce and enterprises to adapt to changes, ⮚ to increase the flexibility of the labour market, ⮚ to help persons at risk of social exclusion, to increase the quality and accessibility of social services and introducing measures increasing the employability of these persons, ⮚ to promote equal opportunities for women and men in the labour market. During the economic crisis, the trend in balancing differences in the regional employment rates in each region of the Czech Republic reversed, as the differences between them had risen again. Thus, the urgency of the need to support the labour market and employment persists, in fact its importance has even grown. Similarly, the importance of the territorial dimension is growing – the recession had a different impact on the regions of the Czech Republic and there are some significant structural regional differences which results in the concentration of labour market issues into some regions. Despite the negative development of the Czech economy there has been an increase in the overall employment rate, and the employment rate of women and older persons also increased. The Czech Republic came closer to achieving some of the national targets in the area of employment in relation to the Europe 2020 strategy. The experience from the current programming period have shown how important it is when all players in the labour market work together when trying to resolve employment issues, and that it is necessary to have a better link between ALMP and other instruments, in particular in the area of social inclusion. Another important finding has been the need to strengthen analytical and monitoring tools that would enable better targeting of interventions and to improve their efficiency. With regard to the impacts of the economic recession, the labour market interventions in the 2014-2020 period will mainly focus on improvement and modernisation of employment services and their interconnection with other services, in particular in the area of social inclusion. It is important to increase the number and share of job applicants supported as part of active labour market policy instruments, to increase the employment rate of supported persons with an emphasis on the groups of people that are at risk in the labour market, to increase the harmony between qualifications and skills of employees and employers´ requirements, to increase the use of flexible forms of work and to help finding a good balance between private life and work. The experience from the current period has also shown that it is necessary to increase participation of adults in further education (FE) by focusing on the development of professional and key competencies. However, while doing so it is necessary to put greater emphasis on the quality of FE and the related career consultancy services without which the FE benefits would not be sufficient for the target groups. Xxxxx identified challenges and development needs: The aim of the Czech Republic in connection to Europe 2020 is to raise the employment rate in the economy to 75%. The problem of insufficient employment rate has several reasons which the Czech Republic intends to address with the use of the Structural Funds in 2014- 2020. The reasons are described below. In order to improve the situation in the labour market it is important to create new jobs, which is conditioned by restarting the economic growth and by improving the competitiveness of Czech business entities in the international market. That is the focus of chapter Competitive Business.
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Samples: Partnership Agreement, www.dotaceeu.cz
Functioning labour market. Background and Description The quality of human resources and efficient labour market represent the key features of non-price competitiveness. In particular for a small and open economy as the Czech Republic is, the flexibility of labour force and harmonizing the supply and demand in the labour market represent important tools for dealing with the lost cost advantage which was such an important factor of growth before the start of the economic recession. The Czech labour market is affected by unfavourable economic development. Employment in the Czech economy dropped by 112 thousand jobs in 2008-2012.11 The biggest drop in employment (as absolute value) was suffered by the processing industry where in 2008-2012 the number of jobs decreased by nearly 80 thousand; construction lost further 56 thousand jobs and sales and transport lost 35 thousand jobs.12 One of the factors of the growth of unemployment is also the regional economic structure and its economic performance. The development stated above resulted in a rapid growth of unemployment. In September 2013, more than 550 thousand unemployed were registered; compared to June 2008 when the number of unemployed dropped below 300 thousand, this represents an increase by nearly 90%. The registered unemployment rate reached 9.4% at the end of 2012. More than 192 thousand unemployed have been registered for more than a year; in 2008–2012 this number increased by more than 90%. There is a risk of an increasing structural character of the unemployment, which would require difficult and costly solutions. Even though in the global context, the situation in the Czech labour market is still fairly good, the reality for some groups of the population is significantly worse. Persons aged 50+, disabled people and ethnic minorities, in particular the Roma, face higher risks of unemployment and loss of jobs. With regard to the employment rate of older persons (49 %13) the Czech Republic is at the EU average, however there is a significant difference between men (60%) and women (39%). The level of employment of persons with primary school education and without education is significantly below the EU average (in 2012 it was lower by 13.6 p. p.) and it is still decreasing. The level of employment of young people (20–29 year-olds) has also been showing a downward trend in the long term (in 2000 it was 66%, in 2012 only 57.8%) and their unemployment grows proportionally. The proportion of young people outside the labour market or without education is still below the EU average, however even this number is growing (8.9% in 2012). The Czech labour market is 11 Data source: CZSO: Time sequence of basic indicators of the Labour Force Sample Survey, 2013. Online at: xxxx://xxx.xxxx.xx/csu/xxxxxxx.xxx/i/prumysl_energetika 12 Data source: CZSO: Labour Force Sample Survey, 2013. Own calculations. 13Data sources in this part of the analysis: CZSO: Labour Force Sample Survey, 2013. Own calculations. specific due to the significant difference between the employment of men and women. The gender employment gap, i.e. the difference between the employment of men and women is 17.5 % (as opposed to the EU average of 12.2 %). Women in the Czech Republic face the most severe drop in employment connected to motherhood and raising children in Europe, mainly due to the insufficient availability of child-care services linked to the low use of part- time employment (according to OECD data, the Czech Republic has the lowest employment of women with children up to 12 years of age out of all EU Member States, of that the minimum employment of women with children below 3 years of age). Despite the complex development in the labour market in the Czech Republic there are still industries where the rate of employment is on the increase. These are often industries that are knowledge-based and high-tech (architectural and engineering services, IT services or production of electronic and optical devices), however their development is slowed down by poor accessibility of qualified staff and the level of discrepancies between the competencies of the workforce and employers´ requirements. This issue must be addressed both at the national, regional and local levels of the labour market and also in terms of education, by utilising the potential of the workforce within the territory in relation to support of education in the relevant fields. The Strategy for Inclusive, Smart and Sustainable Growth ("Europe 2020") pays a lot of attention to increasing the rate of employment. The National Reform Programme, following up Europe 2020, has determined several objectives for the Czech Republic for the area of employment. Despite the difficult situation in the labour market, the employment rate of women, older persons and the overall employment rate have increased since 2010. The biggest problem is the growing rate of unemployment of persons with low qualifications (see table at the end of the chapter). Territorial differences The labour market develops differently in each region. On one hand, there are "growth poles" in the Czech Republic – centres and regions where the employment rate is growing, and on the other hand, there are structurally and economically weak regions with growing unemployment. The potential for growth and improvement of the situation in the labour market at regional and local levels is mainly in the centres where there are high-tech and knowledge-based industries. Whilst Prague, South Moravian and Central Bohemian Regions have recorded an increase in employment since the recession, other regions have recorded a drop.14 The registered unemployment rate was kept below 5% only in Prague, while in 8 out of 14 Czech regions it exceeded 10% at the end of 2012. In those regions, the ratio of the number of the unemployed to job vacancies is very unfavourable. The registered unemployment rate of young people aged 15-24 was the highest in the Northwest region. In 2012, it reached 28.2%, which is roughly 9 p.p. above the Czech Republic average. What´s more, the figures are growing. The share of employed people under 34 years of age and the share of employed people over 55 years of age shows only small differences in the territory. On the contrary, the share of people employed and unemployed "without education" shows significant inter-regional differences. The development in Prague and South Moravian region (where the employment rate is driven mainly by Brno) but also in other regional centres demonstrates growing labour market differences between towns and rural areas. Job applicants in rural areas account for, approximately, one quarter of all applicants, while vacant job positions in rural areas represent only one sixth of all vacant job positions. There are less jobs created in rural areas 14 Data sources in this part of the analysis: CZSO: Labour Force Sample Survey, 2013. Own calculations. due to several reasons - mainly lower-quality infrastructure for business and lower availability of capital. Due to the lower density of population (and facilities) in the rural areas, the starting and especially the operation of business activities are mostly associated with higher costs. In terms of active labour market policy (ALMP), the activities of the Labour Offices at the level of districts and regions show major territorial differences in terms of the volume of funds expended on ALMP and the volume of requalifications, determined by the level of the registered unemployment rate. The lack of job opportunities in rural areas is one of the main reasons why young people, in particular, migrate to towns. To stabilize the rural population by securing job opportunities is one of the major challenges of the new programming period. It is of key importance to increase the competitiveness of enterprises in the rural areas, including the competitiveness of agricultural entrepreneurs who represent important employers in the areas. Other job opportunities can be created by diversification of their activities. The support will be aimed at: • territories with high unemployment, • economically weak regions (according to the Regional Development Strategy of the Czech Republic for 2014-2020) • NUTS II regions where the unemployment rate of persons aged 15-24 exceeded 25% in 2012 • territories with a need for a systemic solution to restructuring the traditional industrial regions. Experience from the 2007–2013 programming period and the state of achievement of objectives With regard to the labour market the activities of the 2007-2013 programming period sought: ⮚ to increase the skills of the workforce and enterprises to adapt to changes, ⮚ to increase the flexibility of the labour market, ⮚ to help persons at risk of social exclusion, to increase the quality and accessibility of social services and introducing measures increasing the employability of these persons, ⮚ to promote equal opportunities for women and men in the labour market. During the economic crisis, the trend in balancing differences in the regional employment rates in each region of the Czech Republic reversed, as the differences between them had risen again. Thus, the urgency of the need to support the labour market and employment persists, in fact its importance has even grown. Similarly, the importance of the territorial dimension is growing – the recession had a different impact on the regions of the Czech Republic and there are some significant structural regional differences which results in the concentration of labour market issues into some regions. Despite the negative development of the Czech economy there has been an increase in the overall employment rate, and the employment rate of women and older persons also increased. The Czech Republic came closer to achieving some of the national targets in the area of employment in relation to the Europe 2020 strategy. The experience from the current programming period have shown how important it is when all players in the labour market work together when trying to resolve employment issues, and that it is necessary to have a better link between ALMP and other instruments, in particular in the area of social inclusion. Another important finding has been the need to strengthen analytical and monitoring tools that would enable better targeting of interventions and to improve their efficiency. With regard to the impacts of the economic recession, the labour market interventions in the 2014-2020 period will mainly focus on improvement and modernisation of employment services and their interconnection with other services, in particular in the area of social inclusion. It is important to increase the number and share of job applicants supported as part of active labour market policy instruments, to increase the employment rate of supported persons with an emphasis on the groups of people that are at risk in the labour market, to increase the harmony between qualifications and skills of employees and employers´ requirements, to increase the use of flexible forms of work and to help finding a good balance between private life and work. The experience from the current period has also shown that it is necessary to increase participation of adults in further education (FE) by focusing on the development of professional and key competencies. However, while doing so it is necessary to put greater emphasis on the quality of FE and the related career consultancy services without which the FE benefits would not be sufficient for the target groups. Xxxxx identified challenges and development needs: The aim of the Czech Republic in connection to Europe 2020 is to raise the employment rate in the economy to 75%. The problem of insufficient employment rate has several reasons which the Czech Republic intends to address with the use of the Structural Funds in 2014- 2020. The reasons are described below. In order to improve the situation in the labour market it is important to create new jobs, which is conditioned by restarting the economic growth and by improving the competitiveness of Czech business entities in the international market. That is the focus of chapter Competitive Business.
Appears in 2 contracts
Samples: Partnership Agreement, www.dotaceeu.cz
