STATISTICAL OFFICE OF THE REPUBLIC OF SLOVENIA www.stat.si From Traineeship to Retirement REPUBLIC OF SLOVENIA Ljubljana, January 2013 ^COLIECTTON^ BROCHURES J^/ STATISTICAL OFFICE OF THE REPUBLIC OF SLOVENIA www.stat.si From Traineeship to Retirement Ljubljana, January 2013 Authors: Lenart Milan Lah, Irena Svetin, Nuška Brnot, Maja Sever, Darjan Petek, Miran Žavbi, Kaja Malešič, Matej Divjak Translated by Marina Urbas Cover page photo: Lenart Milan Lah Other photos: Irena Svetin and Lenart Milan Lah The publication is available at: www.stat.si/eng/pub.asp Information: Information Centre phone: + 386 1 241 64 04 e-mail: info.stat@gov.si CIP - Kataložni zapis o publikaciji Narodna in univerzitetna knjižnica, Ljubljana 331.5:311(497.4) FROM traineeship to retirement / [authors Lenart Milan Lah ... [et al.] ; photos Irena Svetin and Lenart Lah ; translator Marina Urbas]. - Ljubljana : Statistical Office of the Republic of Slovenia, 2013. - (Collection Brochures / Statistical Office of the Republic of Slovenia) ISBN 978-961-239-262-8 ISBN 978-961-239-263-5 (pdf) 1. Lah, Lenart Milan 265164032 J Issued, published and printed by the Statistical Office of the Republic of Slovenia, Ljubljana, Litostrojska cesta 54 - © SURS - Use and publication of data is allowed provided the source is acknowledged - Printed in 200 copies - ISBN 978-961-239-262-8 FOREWORD In the last 20 years the conditions on the Slovenian labour market have largely changed. When declaring a new independent country the conditions were far from being perfect, but the conditions kept improving until in 2008 Slovenia faced the turning point. The labour market is a multi-layered concept. In fact it is a combination of several factors that affect every individual who is mature and capable to play an active role on the labour market. These factors are being represented in this publication in brief comments and with graphical presentations. We wished to cover an individual's entire active life cycle: from the very beginning - in Slovenia this is usually simple work found by students via the Student Employment Office - until the end, i.e. until retirement. The situation on the labour market and the influences on the phenomenon are described in a time line. The brochure offers a general overview of the labour market situation and is intended to the general public and experts. In various stages of our life we wear different shoes, as we grow up and change; and yet many times in life we have to, metaphorically speaking, step into someone else's shoes, and thus take over the role of someone else. This can apply also for each individual on the labour market. We kindly invite you to look at the position of the stated individual and also to look at the other statistical data presented in this publication. Irena Križman Director-General CONTENTS TWO DECADES OF CHANGES.........................................................................9 HOW MANY OF US WORK AND HOW MANY DO NOT WORK?.....................13 ARE WE WISER?...........................................................................................17 YOUNG PEOPLE ENTERING THE LABOUR MARKET........................................21 JOB VACANCIES...........................................................................................25 WORKAND SPARE TIME..............................................................................29 RECONCILIATION BETWEEN WORKAND FAMILY LIFE...................................33 HOW MUCH DO WE EARN?.........................................................................37 HOWMUCH DOWE COST OUREMPLOYERS?..............................................41 FLEXICURITY................................................................................................47 CITIZENS OF THE EUROPEAN UNION............................................................51 1 2 3 4 5 6 7 8 9 10 11 ABBREVIATIONS AND UNITS OF MEASUREMENT SECTIONS OF ACTIVITIES, SKD 2008................... IN BRIEF fQ In the very beginning of the observed 1991-2011 period the K Slovenian labour market was facing a crisis, which was followed by a period of prosperity; now it has again found itself to be in a crisis. In this period the average earnings kept increasing. Conversion of earnings from SIT (Slovenian tolar) to EUR in 1991 reveals that then the average earnings were much lower than they are at present. The differences in earnings seem much lower when working time required to buy certain goods is compared. The Slovenes currently work fewer hours per week than we did when Slovenia became an independent country- but the period of employment until retirement keeps increasing. j(S> The labour market situation started to deteriorate in the l\ second half of 2008; the psychological barrier of 10% in the unemployment rate was reached in October 2009; a year later the number of those registered at the employment office for the first time after the start of the economic crisis in 2008 exceeded 100,000; in January 2012 both the minimum number of persons in employment after 2005 and also the highest unemployment rate (12.5%) since 1999 were recorded. fQ The data show that higher levels of education provide more K job opportunities and higher earnings. Increasing numbers of young people decide to study as the economy creates an increasing number of jobs that require more skills. The highest number of students in tertiary education was recorded in 2006 (almost 116,000), and from then on their number has been slowly but steadily declining. jtf The transition from education to the labour market is a turning In point in a person's life. It brings new responsibilities, new assignments, and new roles to be played. In 2009 almost half of the young (aged 15-34) pursued further studies at least at the higher education level, and more than half of the young started to work when going to school or while studying. Most of them, of course, worked via student employment offices. fQ In Slovenia in 2011 there were 194,500 advertised job vacancies or on average around 16,000 vacancies per month. There were 711,400 occupied posts, with slightly less than a quarter of them in manufacturing, 14% in trade and 9% in education. jjtf In Slovenia, employees put in on average over a billion working hours per year. The number of working hours covers also the hours when one is absent from work: half of these hours are attributable to annual leave, a quarter to sickness leave and a sixth to public holidays. In Slovenia there are 15 statutory holidays, but in fact there are only 13, as 2 of them (Easter, Whit) fall on a Sunday. IN BRIEF i! Balancing work and family life is one of the conditions for ,( the enforcement of gender equality in the society, especially in the labour market. Women still spend more time on households than men - on average an hour more each day. In Slovenia in 2011 the right to work part-time as parents was exercised by more than 10,000 parents per year. A year earlier 44,000 people worked at least one month less than usual due to the protection and care of children. Among them 72% were women. fS> In Slovenia in 2011, the average monthly net earnings X amounted to a little less than EUR 990. About two-thirds of employees received earnings lower than the average. Earnings of men are on average higher than those of women. The best-paid occupations include legislators, senior officials and managers. At the regional level, the net earnings were the highest in 2011 in the Osrednjeslovenska statistical region and the lowest in Pomurska. At municipal level net earnings were the highest in municipality Cerklje na Gorenjskem and the lowest in municipality Osilnica. The share of earnings represents by far the largest amount in total labour costs. In 2008 the share of only the basic gross earnings with supplements covered a little less than 60%. When taking into account the payments as individual performance bonuses, bonuses linked to collective performance and payments of all compensations of earnings paid by the employer, the share rose to just over 70%; but with the holiday bonus, jubilee rewards, travel costs, costs for meals and payments in kind, which formed the total employee's incomes, the share was almost 85% in 2008. At that time the highest labour costs in the EU were recorded in Luxembourg. In 2010 one of the flexible forms of employment (temporary employment, work on part-time basis, self-employment) provided employment to 33% of employed persons in Slovenia (25% more than 10 years ago). Comparisons reveal that the indicators for the Slovenian labour market varied around the average of EU-27 Member States. Slovenia deviated markedly from this average only with very low activity rates among the elderly. Labour force and inactive persons, Slovenia, 2011 = in 1000 persons LABOUR FORCE INACTIVE EMPLOYEES 779 '' 1 RETIRED 477 PUPILS, STUDENTS PERSONS LESS THAN 15 YEARS 292 I SELF-EMPLOYED 118 UNPAID _ FAMILY WORKERS 1 40 OTHER INACTIVE PERSONS 114 UNEMPLOYED 84 Source: SURS 1 TWO DECADES OF CHANGES Twenty years ago Slovenia faced a situation similar to the current one: the economic crisis. There was no economic boom - but there was an optimistic beginning of a new country ... The difference between the start and end of the 1991-2011 period is in the very nature and also in the perception of the crisis: twentyyears ago the state and state regulations were restructured, but we had a vision and our goal was to join the European Union. The current crisis is deeper and it has affected most of the developed world, and thus the way out of it seems to be much more uncertain than twentyyears ago. ... and times were turbulent We like to say that work has become second nature with the Slovenes. But is this really the case? Some estimates1 reveal that in 1991 there were 792,000 employed persons in Slovenia, with over 90,000 unemployed persons registered at the employment service. Thus the registered unemployment rate was 10%. In 2011 Slovenia had 824,000 employed persons, 111,000 people were registered at the employment service and the registered unemployment rate was 11.8%. What was the situation like between 1991 and 2011? The situation on the Slovenian labour market was the worst in 1993, as on the one hand there were a little less than 765,000 employed persons and on 1 Estimates for 1991 are based on administrative data sources, which do not cover the number of self-employed persons. Since these did not prevail in the previous social system, we assume that this does not significantly affect the quality of the estimates. the other hand there were 129,000 registered unemployed persons; the registered unemployment rate peaked at 14.4%. We experienced also a favourable situation (economic boom until 2008). At that time the registered unemployment rate hit a record low of 6.7%, and so did the number of registered unemployed persons, amounting to 63,000; and so did the number of employed persons in Slovenia - but these figures were the highest (nearly 880,000). "We are not without accomplishment. We have managed to distribute poverty equaCCy." Nguen Co Thatch, post-war Vietnamese foreign minister ... and different currencies were introduced Until they became 18 years old, Slovenes who were born at the end of the 1980s, made use of three currencies and four types of banknotes. With the declaration of independence of Slovenia in 1991, the Yugoslav dinar was replaced by the Slovenian tolar, which was originally printed in the form of vouchers, but later proper tolar banknotes were introduced. In 2007, the Slovenian tolar (SIT) was replaced by the euro (EUR); this made comparisons between the average earnings in the last twenty years almost impossible. Taking into account the SIT-EUR exchange rate of 239.64, the average monthly net earnings in 1991 amounted to EUR 43 and in 2011 to EUR 987. At first glance the difference is huge - but was it really? Can we buy more today than we could years ago? If we look at how long we had to work to purchase certain goods or services in 1991, and the length of time in 2011, we see that the differences are significant, but not as dramatic as the differences in average earnings. Among the selected products and services, in 2011 we had to work longer than two decades ago only to pay for a male haircut. The difference between the time required to earn the money to purchase a kilogram of salt in 1991 and 2011 was the largest, as in 2011 we actually needed to work almost 80% less time than in 1991. To summarize: the last twenty years have seen a sharp "decrease" in goods prices and a strong "increase" in the prices of services. Shorter working time In the recent decades there has been a radical change in the number of working hours. In the mid-1960s we moved from the 48-hour work week to a 42-hour work week, and in mid-1990s the 40-hour work week was introduced, and enacted in 2003. The question is what this really means in everyday life. The first data available from the Labour Force Survey reach back to 1993 when employed persons put in an average of 43.9 hours. The 2011 data further revealed that the employed persons on average worked much less (39.4 hours per week). What is the situation throughout Europe? According to Eurostat data the fewest hours per week are put in in the north, as in 2010 less than 35 hours per week were worked in Ireland, Denmark and Norway. The most time (over 40 hours per week) was spent in the workplace in Cyprus, Romania, Poland, Slovakia, Bulgaria, the Czech Republic and Greece. Table 1: The time a person in employment with the average net earnings must work to be able to buy a product or a service, Slovenia 1991 2011 Rice (kg) 45 min. 23 min. White flour (kg) 15 min. 9 min. Brown bread (kg) 25 min. 19 min. Hen egg 4 min. 2 min. Milk (1) 14 min. 8 min. Potatoes(kg) 13 min. 6 min. Sugar(kg) 25 min. 10 min. Salt (kg) 17 min. 4 min. Roasted coffee (kg) 4h40 min. 1h18 min. Beer (1) 33 min. 18 min. Plain Pen 16 min. 6 min. Clio car 4,389 h 2 min. 1,774 h 7 min. Cinema ticket 53 min. 51 min. Men's haircut 2h 17 min. 2h 32 min. Source: SURS The countries with the shortest working hours: Ireland, Denmark, Norway. 1 The countries with the longest working hours: Bulgaria, the Czech Republic, Greece. We work still a little longer to get our pensions, the number of the retired persons keeps increasing In order to get the right to become retired we have to work longer, the retirement age keeps rising, the difference between the lengths of working ages for men and women is decreasing, longer life expectancy in fact means that the number of years when we shall receive the pension is on the increase. In 2011, Slovenia had almost 570,000 retired persons, while in the early 1990s they numbered over 400,000, and the ratio between the insured persons and retired persons stood at 1.8. In 2011, however, this ratio decreased to only 1.5. This meant that in 2011 there were 1.5 persons in employment per one retired person. We become retired at a constantly higher age: in the last twenty years those who received their first old-age pension were about 6 years older than their counterparts in the early 1990s. The period of receiving the pension keeps prolonging; in the last twenty years this period was extended by 2 years for old-age pensioners, in case of women slightly more than in case of men. In 2011, women were on average receiving their pension for 21 years and 8 months, and men for 16 years and 4 months. According to statistical data, the pension is really being received for a longer time, but - compared to the average earnings - it keeps decreasing: in 1992 the average old-age pension was equivalent to nearly 78% of the average earnings, whereas in 2011 the share amounted to slightly over 63%. 2 HOWMANYOFUSWORKAND HOW MANY DO NOT WORK? In times of an economic crisis, labour market indicators become interesting also to the general public - mainly due to the media, which during this period frequently point out the deterioration in labour market conditions. Thus more and more people know, for example, that registered unemployment exceeded the magic limit of 100,000 people, or that the increase in the number of young job seekers has no end in sight, or that there are fewer and fewer permanent employments, etc. The fact is that the Slovenian labour market is not resistant to the economic crisis and that in the last four years the labour market indicators have been moving in a negative direction. Despite the deterioration, it must be borne in mind that before the economic crisis the situation in the labour market could be described as very good. After a long-term increase, the number of employed persons declined The economic boom that lasted from the beginning of the new millennium until the end of 2008 triggered a steady increase in the number of employed persons in Slovenia. As this indicator had a positive trend, there emerged semi-professional opinions in Slovenia that the recession would not be felt in the Slovenian economy as Slovenia would either not be part of it or it would not significantly reflect in the Slovenian economy. As the statistical data for this field of statistics are published two months after the reference period, at Chart 1: Employed persons and registered unemployed persons, Slovenia 900,000 880,000 860,000 -840,000 820,000 -800,000 -780,000 - I III|III|IV|V|VI|VII|VIII|IX|X|X||XI|| I I 2007 I III IIVIVIVIIVII Ivilll IXIXIXI Ixil I I I 2008 I - employed persons IIVIV IVIIVII Ivilll IXIX IXIIXIII 2009 V IVIIVII Ivilll IXIX IXIIXII | I I 2010 140,000 120,000 - 100,000 - 80,000 - 60,000 - 40,000 - 20,000 llixlxlxilxill I lllllllliv 2012 registered employed persons Sources: SURS, ESS the end of 2008 the October data were published and it was then thought that the recession did not affect Slovenia and that there would be no recession in Slovenia. This, however, afterwards did not prove to be the case. Enterprises started reporting of smaller orders or terminations of orders from abroad, mainly from Germany, which was affected by the recession 6 months ahead of Slovenia, and they also started announcing deliberate reductions in the production volume. How to perceive the economic crisis? Although the number of registered unemployed persons increased in October 2008, this was not understood to be the first sign of the upcoming recession, as previously this was a common seasonal phenomenon (in autumn the employment service usually registers increases in the number of newly registered first job seekers). The dismissals from enterprises have not yet been formally considered, but in the months that followed, the perception changed. In November 2008 the number of employed persons started to decline and it has kept decreasing - on the other hand, the number of registered unemployed persons kept increasing. In October 2009 the registered unemployment rate reached the psychological barrier of 10%. In the beginning of 2010, however, the increase in the number of unemployed persons slowed down, but in the last three months of 2010 it started increasing again and it continued into 2011. In January 2012 there were almost 116,000 registered unemployed persons in Slovenia or the most since the beginning of the economic crisis. The economic crisis is more evident in the export-oriented activities The number of employed persons decreased the most in Manufacturing and in Construction. In October 2008, 35% of all employed persons in Slovenia worked in these sectors of activities. Until January 2012 their number fell by a third in Construction and by almost a fifth in Manufacturing. The significant drop in the number of employed persons in Construction was mainly the result of the accelerated highway construction before the economic crisis, when the number of employed persons in this sector increased significantly. The sharp decline in the number of employed persons in Manufacturing, which employed the largest share of employed persons in Slovenia, was mainly the result of the collapse of almost the entire Slovenian textile industry, which became only a pale shadow of the former flourishing activity, and also of the lower exports which were the result of lower foreign demand for Slovenian products. Although the total number of employed persons during the economic crisis decreased, it nevertheless increased in some of the activities. In fact the number of employed persons increased by over 10% in Professional, scientific and technical activities and in Education, and it significantly increased in Health care and social care, all of which are not export-oriented. "I ife work; it fascinates me. I can sit andCoof^at it forhours." Jerome %. Jerome The registered unemployment rate was: lowest: 6.3% (in September 2008) highest: 15.4% (inDecember 1993) Shop sales assistant and driver - the most common occupations The proportion of employed women is higher than that of men in occupations in education, health care, pharmacy, law, social work, accounting, bookkeeping, human resources and secretarial work, sales, personal services, and cleaning services. Men, however, dominate in the following occupations: engineers, drivers, construction workers, heavy mobile plant operators, carpenters, mechanics, installers and repairers of equipment. At the end of 2011, the largest share of employed women in Slovenia worked as shop sales assistants (over 7%), while the largest share of employed men worked as heavy truck and lorry drivers (almost 5%). According to the stereotype, it is the desire of most girls to become shop sales assistants when they grow up, and thus for many of them their dreams do become the reality. The situation in case of boys is similar: in their childhood they daydream that their occupation will be that of a driver. The share of women in certain occupations which were once considered to be distinctly male ones increases also in Slovenia. At the end of 2000 there were about 9% of women in armed forces occupations and in December 2011 almost 14%. Among police officers 10% were women at the end of 2000 and 16% in 2011. In management men still prevail over women. Among managing directors and chief executives in large and medium-sized enterprises, in Slovenia approximately 26% of them were women (December 2011 data). i The most common occupation for men: driver. The most common occupation for women: shop sales assistant. i 3 ARE WE WISER? Mass participation in formal education on the territory of the present-day Republic of Slovenia started after 1774 with the General school decree with which Maria Theresa of the Austro-Hungarian monarchy introduced the compulsory primary school which every child had to attend. Nowadays those who finish the nine-year compulsory education and choose not to continue formal education are rare exceptions. Trends indicate that after finishing upper secondary education young people do not intend to enter the labour market, but they opt for student life and development of skills in colleges. Extending formal education is not only the result of one's own preferences, but it is mainly attributable to the development of the society as a whole. This namely creates jobs which require more and more knowledge. Educational attainment is in fact the main criterion by which employers who seek new employees decide to select candidates. A higher education level provides knowledge and greater job opportunities, as well as higher earnings. "When I was a boy of fourteen, my father was so ignorant I couldhardCy stand to have the old man around. But when I got to be twenty-one, I was astonished at how much the oldman hadkarned in seven years." MarfsjTwain Among the labour force in Slovenia persons with tertiary education are on the rise Among the labour force in Slovenia the share of those with completed tertiary education is increasing; the proportion of those with primary education or education that is lower than that is decreasing. In 1993, the share of those with at most a completed primary education was still 27%, but by 2011 it fell to less than 13%. For those with short-term higher education the opposite is true: their share rose from 15% to over 27%. In the last two decades the share of people with secondary education was more or less constant at about 60%. Chart 2: Labour force by educational attainment, Slovenia % 70 60 50 40 30 20 10 mm 1993 1995 2000 2005 2011 j ® surs basic education or less education0" ^ tertiary level Source: SURS The education of the Slovenes corresponds to EU average Compared to the average of EU-27 MS on the levels of attained education of labour force, Slovenia in 2010 did rather well. The share of those with completed tertiary education was a little lower than the EU-27 average (25.5%), but that of those with completed upper secondary education was higher (60.6%). The share of those with at most a completed primary education was 13.9% in Slovenia and thus considerably lower than the EU-27 average. In view of this share, Slovenia ranked among the EU Member States with the lowest shares of the least educated where the former socialist countries dominated. The reasons for the low share of less-educated are that these countries have compulsory education for a long time and schooling at higher levels is not subject to payment. In the past these countries also had much less immigration than the developed EU countries, which were and remained attractive to less-educated labour force, resulting in a higher share of those with lower educational levels. Chart 3: Labour force by educational attainment, EU-27 and Slovenia, 2010 EU-27 Slovenia i-1 basic education r 1-1 or less Source: Eurostat i upper secondary i-1 short-term higher education 1 education 1-1 and academic higher education There is more work for the better educated One's opportunities in the labour market depend on one's educational attainment. The ratios of the working statuses of the population (employed persons - the unemployed - the inactive) by educational attainment are more favourable for those with higher levels of education. Among those with tertiary education in Slovenia in 2011 there were 76% of employed persons, the unemployed accounted for 4% and the inactive for about 20%. Among those with a secondary education, 57% of persons were employed, 5% looking for work and 38% inactive. The "least favourable" ratio was revealed among the work statuses of those with completed basic education or less: 26% employed, 4% were unemployed and 70% inactive. i Unemployment rates for those with: completed basic education or less: 13.1% - completed tertiaryeducation: 4.9%. Employment rates for those with: completed basic education or less: 26.3% - completed tertiary education: 76.3%. The level of the attained education has an impact on various employment statuses of those who have jobs. Among those with tertiary education in 2011 89% were employees, over 10% self-employed and only few unpaid family workers. Among the persons with upper secondary education the ratios were similar: 84% were employees, 13% self-employed and just over 3% unpaid family workers. Among those with basic education or less 66% were employees, 16% self-employed and about 18% were unpaid family workers. If employees with different levels of education are examined in relation to their working hours and type of employment, other differences are revealed. Among those with complete basic education or less in 2011 there were 21% who performed work on part-time basis; among those with tertiary education there were 6.6% such people. The share of those with fixed-term employment was higher among those with primary or secondary education (23.2%) than among those with tertiary education (14.8%). earnings are on average lower (the first decile covers those with the lowest earnings and the tenth decile those with the highest earnings). In view of earnings, only 16% of employees with basic education or less in Slovenia in 2010 ranked higher than the fifth decile. On the other hand, there were employees with short-term higher education and academic higher education and the largest share of them ranked in the top decile. In view of their earnings as many as two-thirds of the most educated people ranked in the top three deciles. "Some people work, but do not think, the others think, but do not work." Ugo ToscoCo Is getting an education worth it? Does education get paid? As not all the occupations are equally demanding, jobs are evaluated differently and earnings vary depending on the kind of work that is performed. Given that there is a link between occupation and education, it is further anticipated that there is a link between educational attainment and earnings. The breakdown of employees by level of educational attainment and arranging them by their earnings (into deciles) show that less educated people are classified mainly in the lower half of the deciles. Thus their Chart 4: Employees by educational attainment and earnings, Slovenia, 2010 10" decile S* decile 8th decile T decile 1" decile 2 decile 3d decile 4th decile 5th decile 6" decile □ basii Source: SURS basic education or less ectucation0"''31^ tertiary education YOUNG PEOPLE ENTERING THE LABOUR MARKET 4 YOUNG PEOPLE ENTERING THE LABOUR MARKET Transition from education into the labour market is not an easy step. It is especially difficult when the person is young, unemployed, often with poor or no work experience, sometimes even with an education that exceeds the labour market demands, and has too high expectations. This is a turning point Transition from education into the labour market is a turning point in the life of every person, bringing new responsibilities, new assignments and new roles. The age of persons in transition from school to work is increasing because young people prolong their study so as not to get the status of an unemployed person - which would occur due to lack of work experience. Therefore they decide to continue with their studies. This, on the other hand, can drag them into the vicious circle of becoming yet more difficult to employ (having more education than is required). Namely, tertiary education without work experience is not highly appreciated by the employers. But the young nevertheless find their jobs quicker than the elderly as they are more flexible and are ready to take up different jobs. On average, in 2011 young unemployed people (aged 15-34) were looking for a job for just over 11 months, while unemployed people aged 35+ were looking for a job for almost 14 months. Every year the labour market is entered by: