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EBRD and ILO advise North Macedonia on labour market after coronavirus

By Axel  Reiserer

Severe impact of pandemic requires massive state intervention

  • EBRD-ILO task force develops policy recommendations for North Macedonia
  • Pandemic has severe impact on local labour markets
  • Workers and enterprises in certain sectors are particularly affected

Creating employment and protecting livelihoods and businesses are the goals of recommendations developed by a joint task force of the European Bank for Reconstruction and Development (EBRD) and the International Labour Organization (ILO) commissioned by North Macedonia’s Economic and Social Council.

A report, presented to the authorities in Skopje and published today, lists a set of proposals to achieve these goals. Options for expanding protection for workers and families include:

  • the introduction of temporary unemployment assistance, paid monthly at a flat rate for a maximum of six months
  • the introduction of an intermediate category of firms eligible for job retention measures
  • an extension of the job retention programme’s eligibility period to include the second half of March and up to the end of June.
  • a further extension of the eligibility rules for guaranteed minimum income
  • the introduction of a lump-sum utility-cost subsidy or energy subsidy for low-income households.

Active employment measures could include further promotion of job-sharing schemes, job rotation and trainee schemes as well as investment in the digital economy. Ways to further support enterprises focus on greater access to finance, administrative support and social dialogue between stakeholders.

The Economic and Social Council invited the EBRD-ILO task force earlier this year to support the development of policy responses, when the public health threat developed into a global pandemic with grave economic consequences. North Macedonia imposed wide-reaching restrictions to prevent the spread of the virus and has managed so far to limit the number of deaths to 116 out of 2,039 registered cases of infection.

Meanwhile, the measures have severely impacted the economy. According to ILO estimates, the equivalent of 85,550 full-time jobs was lost in the second quarter of 2020 alone. In its most recent forecast, the EBRD in May expects a drop in economic performance in North Macedonia in 2020 by 3.5 per cent, before a recovery by 5.5 per cent in 2021.

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