Job mar­ket’s growth po­ten­tial

NBG says 150,000 peo­ple have found em­ploy­ment in last 3 years and an­other 230,000 could fol­low by 2019

Kathimerini English - - Focus - BY ROULA SALOUROU

The ex­pan­sion of flex­i­ble labor led to the cre­ation of 150,000 new jobs in the coun­try from the sec­ond quar­ter of 2014 to the first of 2017, ac­cord­ing to Na­tional Bank of Greece’s monthly eco­nomic bul­letin.

Fol­low­ing a pe­riod when pri­vate sec­tor em­ploy­ment shrank dra­mat­i­cally – 1.1 mil­lion jobs were lost from 2009 to 2013 – and the labor mar­ket un­der­went a painful re­struc­tur­ing, the NBG anal­y­sis dis­cerns the po­ten­tial for the cre­ation of as many as 230,000 jobs up to 2019. It does set a con­di­tion for that, which is the re­cov­ery of busi­ness in­vest­ments.

Ac­cord­ing to the bul­letin, em­ploy­ment in the pri­vate sec­tor grew by 5.2 per­cent within three years, with the av­er­age growth rate at 1.5 per­cent per year, in a pe­riod when gross do­mes­tic prod­uct re­mained practi- cally stag­nant. Of the 1.1 mil­lion work­ers who lost their jobs from 2009 to 2013, 780,000 were salary work­ers and 320,000 were self-em­ployed pro­fes­sion­als and un­paid work­ers em­ployed in fam­ily en­ter­prises.

The anal­y­sis stresses the con­sid­er­able role of flex­i­ble forms of labor with a rel­a­tively low number of work­ing hours per week and of­ten un­sta­ble fea­tures. It does note, how­ever, that given the very high job­less rate and the flight of some 450,000 Greeks abroad in the last eight years, pri­or­ity must be placed on the econ­omy’s ca­pac­ity to cre­ate jobs in the pri­vate sec­tor at a grow­ing rate. Cru­cially, job mar­ket growth will stem the brain drain if the cre­ation of new jobs is ac­com­pa­nied by an im­prove­ment in the qual­ity of em­ploy­ment.

NBG notes that for the mo­men­tum to grow, the labor mar­ket re­quires an im­me­di­ate re­bound in pro­duc­tive 818.63 1.1694 in­vest­ments fol­low­ing sev­eral years of di­vest­ment that has driven the ra­tio of the em­ploy­ment index to busi­ness in­vest­ment to 23 per­cent, with neg­a­tive con­se­quences for pro­duc­tiv­ity.

A sus­tain­able cor­rec­tion in the labor mar­ket will re­quire a min­i­mum of five years with an in­crease in cap­i­tal in­vest­ment av­er­ag­ing at least 8 per­cent per an­num, the anal­y­sis states.

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