Brief Assessment of the Labour Market Situation in Selected CIS Countries

Abstract

After more than 15 years of transition, some of CIS countries face serious problems on their labour markets, in spite of significant economic growth in recent years, with weak job creation, employment contraction, decreasing activity rates, high unemployment, declining industries and labour redundancies, and widespread informal economy. Consequently, these countries are confronted with serious poverty and social exclusion of certain population segments, while the weight of subsistence agriculture and small-scale self-employment activities are expanding as one coping strategy against poverty. The main factors responsible for this situation are related to labour hoarding inherited from Soviet era, which reduces the productivity of labour; a certain tendency in private and privatized firms to substitute the labour for capital; slow and inefficient structural restructuring, leading to unfriendly business environment and considerable barriers to entry and expanding the economic activity; mismatch between the demand for skills required by the market, and the effective skills supplied through the education system. Six countries are selected for this comparative analysis: Armenia, Azerbaijan, Georgia, Moldova, Ukraine, and Tajikistan.