Low labour force participation and high outward migration
The outlook of Moldovan economy remains positive but downside risks are increasing. Heightened political instability did not preclude a robust growth in 2019. Public investment, double-digit increase in wages, social transfers and workers’ remittances fueled the growth but not employment. Moldova needs sustained growth to create jobs and lift people out of poverty. To this end, a new economic paradigm for Moldova is critical to boost investment, productivity and competitiveness, export-oriented industries and a knowledge-based society.
Volatile macroeconomic environment and political instability made a dent in the performance of the labour market. With a low unemployment rate, Moldova continues to struggle with the lowest labour force participation in the region, skills mismatches, large outmigration flows, high inactivity and a great incidence of youth neither in employment nor in education or training. Informality continues to be high, the quality of jobs requires substantive improvement. There is a need for a consistent reform of the occupational safety and health system. The ongoing labour legislation reform is relevant both for EU association aspirations and for advancement of social dialogue.
To overcome these challenges the ILO is offering assistance in:
- Promoting comprehensive employment policies and inclusive labour market solutions for vulnerable job-seekers;
- Enhancement of social dialogue and collective bargaining through capacity building of the social partners and tripartite skills sectorial committees; and
- Strengthening labor inspection and occupational safety and health in the critical sectors.
The ILO in Moldova has been active since October 2005 with a focus on major nation-wide challenges identified with its constituents and emphasized in its Decent Work Country Programme. ILO assisted recent reforms, including public sector pay reform and modernization of the Public Employment Service (PES). It supported the first time ever Local Employment Partnerships to generate jobs and improve livelihoods in rural communities. The ILO builds knowledge on better working conditions with regard to working time, contractual arrangements and employment protection, and helps Moldova meet reporting obligations to ratified International Labour Standards (42 ILO Conventions), including the 8 Fundamental Conventions.