As Adriano Milovan/Novac.hr writes on the 4th of March, 2019, the situation on the Croatian labour market is all the more alarming: despite the significant number of registered unemployed people, there are numerous activities for which a labour force must be imported. With regard to the further trends on the labour market, as well as the challenges that Croatia is facing in terms of a digital revolution, Novac sat down and talked to the leading man of the consulting house of the EC in Croatia, Berislav Horvat. Berislav Horvat has good knowledge of the trends on the labour market, as well as on entrepreneurial scenes across Croatia.

We're approaching the 6th anniversary of EU membership and the 28th anniversary of independence. While we have achieved our main political goals as a country, it's a general belief that we've left it a bit late when coming up with an economic plan. How do you assess the current development of entrepreneurship in Croatia, especially compared to the countries we're usually compared to?

Unfortunately, we have not yet completed the transition process. On the other hand, our entrepreneurs don't yet enjoy the status in our society that they enjoy in other transition countries. In our country, entrepreneurs are still looked at with skepticism, they're still the black sheep in a way, and realistically, they don't deserve such a status. The EC has therefore launched the ''EC entrepreneur of the year'' program, through which we want to show that there are also successful entrepreneurial stories in Croatia.

I personally think that the situation in Croatia and the attitude towards entrepreneurs in the last five years has changed significantly. In that sense, it's enough to say that five years ago in Croatia, practically nobody spoke about startups, funding, and so on. Moreover, these terms weren't even being used. Nowadays, the situation is different: we're talking about that, we look at who started a startup, who invested what, what entrepreneurial incubator was used and the like... So, the focus of the public is slowly changing and turning towards entrepreneurship, but it's not as fast as we'd like it to be.

Exactly. We do have all this Croatia today, but there's still very little of it. Even the many start-up companies belong to ''emergency entrepreneurship'', ie, they're not a real statement of the desire to start a business in order to engage in entrepreneurship, but are driven for the sake of employment...

I think there's far more entrepreneurship in Croatia than we can see. Media attention loves to highlight the negatives and it's difficult for some of the entrepreneurs to become a star in such a situation.

In Estonia, for example, it's different. Their stars were also once football players, athletes, and starlets, but they systematically worked to change that. Today, after twenty or more years, Estonia's main stars are entrepreneurs, which, of course, doesn't mean that their media doesn't highlight lifestyle [sections] and that jet set type people aren't stars. There's enough space for everyone.

But we have not yet reached that level. In our public domain, the best still don't dominate [the scene], those who have created something from nothing and succeeded in life with their own work and effort. We've gone too deeply into the negativity and now we can't get out of it, even in the conditions that in recent years the situation with the economy is much better, as is evidenced by the growth in income and profit of companies. That's why we have the impression that everything is bad, and that's just not the case. You can be successful in Croatia.

When you talk to clients, especially those from overseas who want to invest and start a business here, what do they complain about most?

The main problem over the last few years is the lack of workforce. Mass emigration from Croatia resulted in a shortage of workers. Before that, you could feel a lack of workforce in tourism, hospitality and construction, and now that's the case in almost all sectors. This will surely be a major obstacle to the further development of Croatia. An example is the construction industry, which even for a secure job constructing something, you can no longer find people to do it.

Once, our main problem was unemployment, and now it's a shortage of workers. According to some estimates, even among those who are officially registered as unemployed, there are only actually 10,000 to 15,000 who really are unemployed, while others have remained registered as such for other reasons.

On the other hand, this year we've got a quota of 65,000 foreign workers we can import. This is the record for now, and it's quite certain that this quota, and thus the number of foreign workers in Croatia will grow in the next few years.

Apart from tourism and construction, which sectors lack a workforce the most?

Definitely the IT sector. Practically every IT company I know would hire 100 developers tomorrow because there's a lot of work. Most of them work on foreign markets, where the demand is higher than the supply.

Do you expect bigger waves of emigration from Croatia? Let us not forget that next year the doors of to the Austrian labour market, the last in the EU [to keep restrictions on Croatian workers] will open...

Emigration will still continue. True, Austria could attract a part of our workforce because it's close and workers will be able to come and go virtually from weekend to weekend. So, emigration will continue, but there will be returns, especially as salaries in Croatia are rising. Estimates for the future are difficult to give, but it's clear that the shortage of workforce will remain the number one issue for Croatia in the next few years.

How do we solve the problem of the lack of workforce?

We will have to turn to the import of labour, in the long term. But let's not forget that because of this shortage of labour in Croatia, there's a rise in wages, which means that some of the Croats who have left will come back in time. They will simply begin to calculate whether it's worth living abroad or here. Let's be realistic, many of our emigrants, especially those who are paid less, don't live in the best conditions in the countries they've moved to, so we already have cases where people are returning. The salary increase in Croatia will bring back some of those who left the country.

There is also the problem of education, the programs of which should be adapted to the needs of the labour market, just as enrollment quotas should be.

What could the state do to reduce emigration and boost returns?

The state could intervene in tax policy measures. Further reductions in personal income tax and the abolition of the highest tax rate would greatly help people increase their net salaries. This would lead to less people leaving and some former emigrants returning.

But, how usefeul are such efforts when taking into account the state of public finances, especially the pension and health system?

These measures can be implemented, but the only way to do that is to reduce the spending of the state, on both a central and a local level. This implies reforms. There is also a need to increase the base of people who pay taxes, or more people bring to the labour market.

Now the situation is almost ideal for some action to be taken: in the real sector there is a lack of people, and in the public there is a surplus of employees. The economy is growing, and the government is stable, so there should not be many problems and the solution is obvious. So, we just have to implement the reforms we're talking about. This is a historical moment that this government has and it must use it.

The world is undergoing a new digital revolution, but we're lagging behind. Moreover, we're still dealing with ''classic'' industries. What are the perspectives open to us?

Digitisation opens up a large area, and a large number of companies that are opening in Croatia are IT companies, so we can't say that we're not following trends in the digital world. Existing, already established Croatian companies invest heavily in digitisation. For many Croatian companies, the EC helps in the introduction of software robotisation. While, for example, Gideon Brothers produced real autonomous robots, which instead of forklifts drive pallets by warehouse, and our domestic companies, such as Atlantica, Orbica and Tokić, are already piloting projects with this new technology. Or, let's say, Mate Rimac, our EC entrepreneur of the year, who, besides producing cars, works hard on the development of the use of digital technologies, and all this is happening in Croatia.

You are in contact with investors. What is the current interest in Croatia from investors?

We are a world leader in auditing and consulting services. We have 270,000 employees worldwide, and in Croatia there are more than 220. Among our clients, we have a lot of investors who want to invest here, especially private equity funds. Still, the problem is that they are looking for big investments, those of 20 or 30 million euros, and there aren't many like that in Croatia. In the case of Croatia, it would probably have helped us to have venture capital funds, which would aid startups. Otherwise, HBOR and EIF have recently launched a venture capital program, which is good for entrepreneurship development in Croatia, but, it's also necessary to have a network of business angels, venture capital funds and private equity funds, so that the system can accommodate and enable funding at all stages of entrepreneurship development.

How does the digital revolution reflect on the EC?

The EC is doing a lot of work on digitalisation. We have digitised our internal talent management system and now we have ''click'' solutions. Numerous processes have been robotised. One digital marketing company joined us last year, so now we have a rounded service - from tips to accessing a buyer, to the performance of the app or website. Customers want less advice, they're now seeking complete solutions, and we can offer them that now. This also allows us to work on innovations. We're also investing hundreds of millions of dollars in audit tools and technology so we can carry out EC digital audits worldwide. I can say that a lot has changed since I started doing this job sixteen years ago!

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Click here for the original article/interview by Adriano Milovan for Novac.hr/Jutarnji

As Goran Jungvirth/Poslovni Dnevnik writes on the 24th of February, 2019, just like in the case of many other industries and categories of workers across the Republic of Croatia, the student population also poses a major challenge to employers when it comes to hiring employees, which is why new web portals and applications are being launched with a view to better connecting the supply and demand markets.

At the end of October 2018, a new law on Student Affairs was finally adopted in Croatian Parliament, with the aim of introducing changes that should provide more ease and significantly better conditions for the country's many students.

The move foresaw that the payment of a contractual fee be guaranteed within fifteen days, the introduction of a digital system was introduced, minimum times and their various accompanying payments were introduced, with an increase for working on Sundays, as well as for working at night and during holidays, as well as some other more than welcome student benefits.

Legislators made the changes justified by the desire to put an end to the exploitation of Croatia's students as little more than cheap labour for greedy employers in numerous different sectors.

Out of about 160,000 students in the Republic of Croatia, about thirty percent are extraordinary students, therefore it is expected that they will also work on student contracts, further strengthen the market for the country's potential student workforce, and more easily meet the needs of the demand market and of their respective employers.

However, it seems that such ''high-quality'' students are hard to come by and all but unavailable, because they're either simply not interested or they're already engaged in some sort of other work.

Labour market agents only noted the initial higher response of these so-called extraordinary students after they too were permitted to work through student contracts, but that situation, like many others, soon became a ''lethargic'' one.

"The problem is also a student's time and availability is limited to their university commitments, and employers of course want the same commitment as full-time employees, but students naturally don't want to lose their often beneficial student rights," stated Saša Jurković of Jazavac's management, an application which seeks to better connect students and their would-be employers.

"Jazavac was created to allow students to find work faster and for employers to reach students as quickly as possible through matching and merge apps," said Jurković when speaking about the project which has been co-financed by the European Union via the European Regional Development Fund.

In addition to increasing immigration and the concerning and accelerated departure of young people from Croatia seeking (among other things) better economic conditions elsewhere, statistics also show a worrying and fairly intensive decrease in the total number of people studying in Croatia at all.

Despite the increasing number of private faculties, polytechnics and colleges across the country, in the last five years alone, the number of students has decreased by more than fifteen percent. Additionally, according to the Central Bureau of Statistics for the academic year 2012/2013, there were 188,285 students actively studying in a facility in the Republic of Croatia, which is nearly 30,000 more than there are currently.

In order to maintain the dynamics of the market between students and employers, it's necessary for them to not only be better connected, but to be more informed in general.

"For now, we have over 900 undergraduate students and over 100 employers who use the search engine and periodically publish their ads. We're growing quickly but we need more students and companies and want to connect with the Student Center (SC) to help them be even more successful. As the oldest source of student affairs, SC has not achieved satisfactory results for a long time for those students who require employers, so employers are forced to use different social networks, portals and pages to find students,'' Jurković described the issue, giving an example of how to create a much better connection between students and their potential employers.

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Click here for the original article by Goran Jungvirth for Poslovni Dnevnik

Most of Croatia's biggest entrepreneurs are located on the northern Adriatic islands, and Croatia's biggest employers are still in the tourism and trade industries.

As Poslovni Dnevnik/Darko Bicak writes on the 6th of February, 2019, according to the analysis of the Financial Agency (FINA), which included details on entrepreneurs operating in the Republic of Croatia, there are 4,322 of them across 51 cities and municipalities in total who work as classified entrepreneurs, and in 2017, the largest number of entrepreneurs were in the field of providing accommodation and food preparation and serving - 903 of them. This tourism sector has now achieved its highest total revenue (almost 2.7 billion kuna), which is 25.6 percent of total income of island entrepreneurs.

Following those in tourism are entrepreneurs in the field of wholesale and retail trade - 656 of them. 2.2 billion kuna or 21.3 percent of total revenues and entrepreneurs are in this field. Construction is ranked third with 472 entrepreneurs and 1.4 billion kuna in revenues, which is 13.7 percent of total income of entrepreneurs from island areas.

In the case of tourism entrepreneurs, these were the highest in terms of the number of employees, with 6,585 employees or 30.6 percent of the total number of employees in all activities. This group of entrepreneurs also earned the highest revenues, and among them, according to the criterion of total revenues, the best are the hotel and tourism companies from Mali Lošinj, Hvar and Rab, or Jadranka hotels, Sunčani Hvar, and Imperial.

When looking at the ''size'' of these entrepreneurs, the largest number of micro entrepreneurs with 92 percent of the share in the total number of entrepreneurs are registered in the observed island areas. In addition, the same group have the largest share in profits, 42.7 percent, and employ the largest number of workers, making up a significant 33.8 percent of the total number of employed people in island towns and municipalities.

There are nine big companies based on islands in the Republic of Croatia, one in the area of ​​trade, Trgovina Krk from Malinska on Krk, one in the field of construction, GP Krk from Krk, one in the processing industry, Sardina from Brač and one in the area of ​​passenger transport, Autotrans from the island of Cres, while the remaining six are in the area of the ​​provision of accommodation and food preparation and service.

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Click here for the original article by Darko Bicak for Poslovni Dnevnik

With the firm support of the Croatian Trade Union, since the 1st of January this year, Konzum increased the salaries of its employees by a net amount of 350 kuna.

As Poslovni Dnevnik writes on the 1st of February, 2019, this wage increase from Konzum refers to employees who are being paid on the basis of coefficiency and will be paid permanently, in addition to their usual monthly salaries, in an amount that is entirely non-taxable, starting with the first such salary from January this year.

"I'm glad to start this year with some good news for our employees. Their satisfaction is high on the list of our priorities, and with this move we want to show them once again how much we appreciate their daily work and efforts to contribute to stable business and good business results,'' stated Slavko Ledić of Konzum's management board.

This income increase is a continuation of Konzum's policy of improving and increasing its workers' rights and benefits. Due to the formerly enfeebled company's successful business results, from the beginning of 2018 to today, salaries have increased by a total of six percent. With the increase of the paid Christmas bonus in the amount of 1,500 kuna per employee, throughout 2018 there were also numerous other benefits which were secured, such as Easter bonuses, a bonus for children, and paid private health insurance.

Despite Agrokor's ups and downs that have continued to rock the Croatian economy over the past couple of years, Konzum has employed more than 1,300 new workers over the past year, mostly in the retail and logistics sectors. All employees are readily offered flexible working hours, a convenience that is of particular interest to parents, students, and henceforth to retirees to whom half-time employment is open, in accordance with the new statutory provisions.

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One Labin factory goes from the worrying signs of closure to contracting brand new jobs in a dramatic yet welcome turnaround.

As Poslovni Dnevnik writes on the 30th of January, 2019, back in October last year, the Syndicate of Istria, Kvarner and Dalmatia warned that after five years of successfully dealing with mobile homes for camps, there would be a possibility of shutting down the CR Abitare factory in Labin, Istria.

Instead of getting the sack from the company, which at one point looked like an unfortunate yet very likely option, the workers of the Labin-based company CR Abitare, who produce mobile homes for camps for some of the largest tourist companies in the Republic of Croatia, received a higher salary.

The reason for the rising levels of anxiety which began back in 2018 when the possibility of the factory's closure arose, was that the production hall had gradually begun to empty, and the workers, twenty of them permanently employed and thirty seasonal workers, had no information.

But the formerly enfeebled company, according to a report from Glas Istre, has continued to operate, and unlike other large companies that have made headlines lately for all the wrong reasons, its workers have been being continually paid their salaries all the time, and the amount has risen by nine percent since the 1st of January, 2019.

In November last year, several new orders for mobile homes were contracted by the Labin company, which are now in the process of production, with delivery expected over the coming days. According to reassuring employer announcements, further orders are also expected.

Although there are currently no new jobs on offer at the Labin factory as it gets back on its feet remarkably quickly, it is to be expected that an increase in the production plan will naturally create the conditions for that at some point or another.

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The Days of jobs in tourism events across three Croatian cities, both in continental Croatia and on the coast, are set to offer new employment opportunities for many seeking to enter into the world of tourism, which is by far Croatia's greatest economic asset.

While jobs in Croatia might appear to be few and far between for many of those seeking opportunities elsewhere across the territory of the European Union, tourism remains by far the strongest sector in Croatia, with numerous positions available up and down the coast, and doors opening even in the previously overlooked continental part of Croatia as more and more tourists 

As Poslovni Dnevnik writes on the 25th of January, 2019, the Days of jobs in tourism event will bring together many Croatian employers from across the tourism sector to get both currently unemployed people and those seeking a career change interested in working in Croatia's booming tourism sector this upcoming summer season.

The ''Days of jobs in tourism" event will be held for the third consecutive year this year under the official organisation of the Ministry of Labour and Pensions, the Ministry of Tourism, the Croatian Employment Service and the Croatian National Tourist Board.

The aim of this event is to enable employers and the currently unemployed to connect with each other, gain important information on employment opportunities and engage in tourism career development in one place.

According to the estimates of the event's organisers, this year, "Days of jobs in tourism" will bring together more than 120 employers and more than 17,000 visitors seeking seasonal employment from three cities - January the 18th in Osijek, January the 25th in Zagreb and February the 1st down on the coast itself in Split.

Minister of Labour Marko Pavić and Tourism Minister Gari Cappelli paid a visit to the Zagreb event which start at 10:00 today at the Zagreb Fair (Velesajam).

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As Poslovni Dnevnik writes on the 24th of January, 2019, at this stage, the Croatian production company Dilj d.o.o. is set to invest significant resources in the overhaul of the plant, and the plan is to put additional resources in the next phase to raise and expand the capacity of their brick factory.

This Vinkovci-based Croatian production company is a manufacturer of brick, tile, grout and special roof elements, which exports 70 percent of its production to both European and non-European markets. Dilj d.o.o. rescued a small brick factory from Našice, which was in the process of going into liquidation. In the very process of bankruptcy, the move saw it successfully renew its production.

In addition to saving production, they saved fifty grateful employees from certain job losses, which would have meant that nearly fifty families would have been left without income. The director of Dilja d.o.o. Dražen Ivezić recalls that the Slavko IGM Našice brick factory went into bankruptcy at the end of 2014 due to problems that were the result of the crisis, which was felt the most by the construction sector, and as material producers, they were hit hard.

As Glas Slavonije writes, at the time of bankruptcy, about fifty workers were employed at the plant, manufacturing a production line of about fifty million units of normal sized and more than ten million block bricks.

The Croatian production company asked the bankruptcy trustee to take over the factory, hire the current workers and continue on with production, and got approval from the creditor council for that step.

''On May the 18th, 2015, we signed a lease contract and continued production. After less than a month and a half, as soon as July the 1st, production continued and everything went smoothly.

Production continued over the next three years, and at the end of last year, Dilj d.o.o. proposed to the bankruptcy trustee and the creditor council to complete the bankruptcy proceedings with the creditor settlement and to take over Slavonia's IGM. After the creditors accepted the bankruptcy plan, in late 2018 Slavonia IGM formally went bankrupt, meaning the preservation of production with a long tradition, as well as the preservation of jobs in the processing industry in Slavonia, which is of particular significance,'' stated Dražen Ivezić, the director of the largest tile factory in the Republic of Croatia with a 95-year-long line tradition of production, unbroken even during various wars.

He added that after the winter renovation phase, the plan for Slavonia's IGM is to be at full capacity by the end of this year, and they are planning to sell everything they produce.

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The Varaždin-based Croatian company Varteks has been producing dresses, coats, jackets and other clothing for specialised purposes, including uniforms for the Croatian Army, the police and the like for 101 years now.

As Poslovni Dnevnik writes on the 23rd of January, 2019, in three production plants in a complex of red brick buildings in the centre of Varaždin, several hundred workers are working daily in one shift on quality garment collections. In Varaždin's Varteks, 24sata journalists were welcomed and hosted by Nenad Bakić, president of Varteks' administration. He took them through all three production facilities. That day, designers who came to Varteks presented Bakić and his associates the new women's collection - business elegance.

''First, we do prototypes of the clothing, then after consultations they go off for additional finishing should that be necessary. After that, we make a collector's sample, a hand-made version that is produced in a small number of copies. If there are no more changes to be made, we make and launch the product,'' explained Bakić. Currently, Varteks is launching its latest elegant collection made with younger people in mind, called Varteks Young.

''We can split production into several phases. Everything begins with the tailor, from the threading and onwards. There, the machine cutter does almost everything itself according to the instructions on the screen. After that, sewing begins. All the parts from the cutter are picked up and people connect them in smaller segments. Then everything is shifted into the assembly, the middle part of production, where some segments are assembled and come to the end with finishing and the final ironing. After that, what's most important to us is quality control. If everything is fine, the goods are sent to the warehouse and are made ready for shipping, to our stores or to our customers,'' explained Miljenko Vidaček, production manager at Varteks. He adds that it takes about four hours to make a suit.

Varteks produces a very wide range of merchandise, its production manager emphasises the fact that Varteks is among the most flexible companies in this part of Europe as a whole.

''We were coming to the end, pre-bankruptcy. We're incredibly grateful to Mr. Bakić for the fact that we're still here,'' Varteks' grateful employees conclude.

For more information on Croatian companies, products and services, as well as doing business in Croatia and the overall business and investment climate, follow our dedicated business page.

Croatia's paradoxical society strikes again as a job posting for a doctor on the island of Hvar from a while ago goes unanswered by anyone from Croatia.

Croatia demographic crisis has left and continues to leave its very real and deeply concerning mark on the domestic labour force. Medics are among those heading off abroad in their droves in search of better wages, more job security, and a less politicised society in which to practice their chosen professions. While at the same time, some of the healthcare offered here in Croatia is among the best, with some of the best professionals on standby to do an excellent job.

The old saying about just not being able to get the staff even stretches to the most academic of positions, it seems.

One job posting from the island of Hvar in particular, in search of a doctor, should have turned the heads of many. The offer showed that the position comes with handsome pay, excellent bonuses and an apartment all thrown in, and on the stunning island of Hvar, of all places. It could be a lot worse, right? It appears that not even this much bait is enough to catch most fish, at least not fish from Croatia.

As Poslovni Dnevnik writes on the 20th of January, 2019, the advertisement for a doctor in Sućuraj on Hvar has been live for around half a year, in which in addition to good wages and a free apartment, a huge bonus of 50,000 kuna per year is offered, as HRT reports.

As yet, not one person from the Republic of Croatia has applied for the position, and the only interested person is a doctor from Macedonia.

The policlinic in Sućuraj on the island of Hvar currently lies empty. There are no patients because there are no doctors, just one nurse. Sadly, this isn't her first time having to work without a doctor in her 37 years of service.

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As Lucija Spiljak/Poslovni Dnevnik writes on the 14th of January, 2019, despite the continuing problems on Croatia's labour market and the mass exodus of the country's talented youth, Croatian students and student associations have some truly valuable projects which showcase real effort, work, and common proactivity with the hope for prosperity, survival and finding employment. Among them is eSTUDENT, the most active Croatian student association founded back in 2004 under the initiative of proactive students and assistants, with the wish that the association and its members become initiators of change, gain practical experience and develop a network of knowledge.

Students lead the association, its projects and its various initiatives, and their goal is, among other things, to provide additional education to other students with a variety of grants, projects, and study quality enhancement. Today, the association is made up of students from the University of Zagreb and other institutions of higher education, with more than 300 members, and each year the association organises more than twenty projects involving thousands of students from across the Republic of Croatia and the wider region. They also launched the Starter project with which, unlike classical student services, work finds the students.

"This involves state-of-the-art technology and programming solutions which have enabled us to send a job offer directly to via email to every student looking for an internship or for employment. Starter's application is free, fast and simple, it provides direct access to excellent jobs, practices and scholarships,'' explained Julija Puškar, the coordinator of Starter at eSTUDENT. They began with the Starter project to link proactive Croatian students to employment programs for the best companies operating across the Republic of Croatia.

"The Starter system is a platform which delivers ads to students, depending on their personal preferences, more specifically to a specific target group of students, many companies send their ads to our system, and members of eSTUDENT who are actively working on the system will forward ads to a particular student group on a daily basis. You just choose the type of ad you want to receive - practice, internship, part time jobs, full time jobs, and the so on.

So, Starter helps students out and makes it easier for them to look for internships or jobs, while allowing companies to search for the best candidates for certain jobs,'' explains Puškar. The first step sees the company send an advertisement to Starter, this ad is then passed on to students with specific interests, and then applications go directly to the employer.

Active members of the Starter team then review the application for the particular ad before submitting the application. There is also the possibility to receive advice on how to improve an application before submitting it to a business or company. In the academic year 2017/2018, the Starter system received more than 350,000 emails and has more than 3,500 active members. The eSTUDENT Student Association is also conducting several projects including Moot Court Croatia, App Start Contest, Case Study Competition, Elektroboj, Mozgalo, Smartup, and Vizionar.

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Click here for the original article by Lucija Spiljak for Poslovni Dnevnik