Structural Unemployment in the Western Balkans: Challenges for Skills Anticipation and Matching Policies

Rapid economic restructuring has led to the emergence of serious skill gaps in many transition economies. Such changes have been especially pronounced in the countries of the Western Balkans due to the break-up of the former Yugoslavia and the subsequent reorientation of previous patterns of economic activity. Structural unemployment has increased to high levels, yet the education and training systems have failed to adapt to the needs for new skills in service sectors and sectors subject to global technological change. This article investigates the use of various skills anticipation methods to inform education and training policy in the region. It argues that the information on skill gaps gathered through these methods are not being used effectively to address skill mismatch, and that existing supply-led matching policies have failed to meet the challenge of high levels of structural unemployment. An alternative demand-led approach is identified, which relies on more decentralized methods to place effective power and influence in the hands of users, whether employers, employees, job-seekers or discouraged workers. It is suggested that this would provide a more appropriate model for the improvement of workforce skills in the Western Balkan countries.