Executive summary

Relative to other OECD countries, Slovenia compares well on most economic, education and social measures. The 2008 crisis revealed a number of vulnerabilities in the economy, putting significant downward pressure on growth and prosperity. Since then, the government has responded with a number of important measures to stimulate job creation and productivity. Yet Slovenia still faces labour market challenges, related to the low participation rate of older workers, and the prevalence of skills shortages and mismatches in certain occupations.

The OECD Local Economic and Employment Development (LEED) Programme has developed its reviews on Local Job Creation as an international cross-comparative study that examines the contributions of local labour market policy to boosting quality employment and productivity. To help Slovenia respond to current and future labour market challenges, the review has looked at a range of institutions and bodies involved in employment and skills policies. In-depth case study work was undertaken in the Drava and South-East regions of Slovenia to understand implementation capacities and opportunities.

Overall, the review found that Slovenia has a dense network of organisations and actors working to increase job creation, innovation and competiveness. Slovenia is a small economy of 2 million people, but regions differ significantly in terms of local economic structure and consequently by unemployment and growth opportunities. The differences are even more pronounced at the municipal level. Despite its small size, Slovenia is divided into 212 municipalities. Often, the smallest or newly established municipalities are also those with the poorest infrastructure and lowest implementation capacities, which can cause a vicious cycle of unemployment and poverty. There are clear tensions between centrally-driven policies and those developed at the local level, which are sometimes targeted to a small number of companies or individuals. The following key conclusions and recommendations are intended to help build and expand on the recent and ongoing reforms to better promote inclusive job creation at the local level in Slovenia.

Key conclusions and recommendations

Better aligning programmes and policies to local economic development

  • Inject flexibility into the management of employment programmes and policies at the local level. In particular, local employment services offices could be provided with a flexible budget envelope to design programmes and strategies for job creation in partnership with other actors, such as regional economic development organisations. This would ensure that programmes are more responsive to local labour market conditions.

  • Create a co-ordinated action plan for jobs and simplify institutional arrangements and responsibilities across the range of government organisations. More should be done to co-ordinate policy planning for employment, skills and economic development at the national level. In addition, a board structure could be piloted across selected regions in Slovenia to bring together employment services, vocational education, economic development organisations with local employers. Such boards could be tasked with co‐ordinating the relevant policy portfolios and provided with a funding envelope to introduce joint programmes under a regional employment and economic development strategy, linked with a national action plan for jobs.

  • Use local labour market information and intelligence to conduct more evaluations on the strengths and weaknesses of EU-funded projects. The government should examine how to strengthen the evaluation of EU-funded projects to ensure that programmes with demonstrated success continue to be delivered and get prioritised over those which do not achieve the same results.

Adding value through skills

  • Create a well-functioning apprenticeship system that better connects training opportunities to the workplace. While a new working group is planned to develop further advice in this area, there is a general lack of awareness about the future directions of apprenticeship in Slovenia. There is an opportunity for local stakeholders to play a critical role in fostering stronger business-education partnerships, which better connect training opportunities to workplace needs. The government should introduce programmes to foster these types of partnerships in order to promote participation in apprenticeship in strategic sectors of the economy.

  • Encourage participation in adult education by developing upskilling and retraining opportunities. Life-long learning systems could be improved in order to provide workers – particularly those with low skills levels – with more opportunities for upskilling and retraining throughout their careers. Measures that could be considered include creating greater financial incentives for older workers to participate in higher education and training programmes, and paying closer attention to the design of such programmes so as to take into account the specific constraints of jobseekers and individuals that are currently in employment.

  • Strengthen local employer ownership of the design and delivery of skills development opportunities. More opportunities need to be provided to local employers to participate in training programmes and advise Vocational Education and Training (VET) providers on their future skills needs. This can be achieved through formal collaboration within “spaces” or networks that give employers opportunities to advise training providers and other local partners, and through informal partnerships. Local leadership is crucial to reach out to employers and facilitate partnership working.

Targeting policy to local employment sectors and investing in quality jobs

  • Focus efforts on the better utilisation of skills to stimulate innovation and productivity. The focused attention on developing competitive sectors within the Smart Specialisation Strategy of Slovenia, together with the inclusion of Human Resources Development and new approaches of inclusive multilevel governance (SRIPs), is welcomed. Going forward, the government should look for further opportunities to work with local employers to move them into higher value added production and re-organise work and jobs to make better use of talent in the workplace. Public procurement policies, financing mechanisms and local anchor institutions can play an important role in assisting employers to adopt high-performance workplace practices and create incremental innovation within a local economy.

  • Foster a stronger culture of entrepreneurship within the employment services, with a focus on the core working age population. While a number of programmes and strategies are in place, more focus should be placed on programming to the general core working age population (as opposed to programmes only focused on youth).

Being inclusive

  • Continue to leverage the social enterprise sector to support inclusive growth. The government should leverage opportunities within the social enterprise sector to support disadvantaged groups in reaching their full labour market potential.