VZCZCXYZ0008
RR RUEHWEB

DE RUEHLJ #0199/01 2011205
ZNR UUUUU ZZH
R 201205Z JUL 09
FM AMEMBASSY LJUBLJANA
TO RUEHC/SECSTATE WASHDC 7384
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUEAIIA/CIA WASHDC

UNCLAS LJUBLJANA 000199 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ECON ELAB SI
SUBJECT: ECONOMIC CRISIS AFFECTS SLOVENIA'S ECONOMIC 
MIGRATION TREND 
 
Summary 
------- 
¶1. (SBU) In response to the global financial crisis, most 
Slovene companies implemented stricter hiring policies in 
the first half of 2009, resulting in a reduction of work 
permits and the elimination of the government's 
prolongation policy for existing permits.  These changes 
reduced employment opportunities for many foreign workers. 
In light of the troubling data on Slovenian economic trends 
and especially the growing unemployment rate, the Slovenian 
Government in January adopted a decree reducing the number 
of work-permits for foreign citizens.  Foreign workers 
usually add approximately 10.0% to the active work 
population of Slovenia.  The economic crisis, however, has 
hit the construction and manufacturing sectors, which have 
the largest percentage of foreign workers, the hardest. 
The overall registered unemployment rate in Slovenia 
increased from 6.6% in April 2008 to 8.8% in April, 2009. 
The issue of foreign workers has thus become a hot 
political topic with opposition parties searching for 
greater protection and an increase of opportunity for 
Slovene workers.  END SUMMARY 
 
Rising Unemployment and Decreased Work Demand Increases 
Pressure on Slovenian Government 
--------------------------------------------- ------ 
 
¶2. (SBU)  Although unemployment remains relatively low in 
Slovenia, it is rising and putting political pressure on 
the government.  The Employment Service of Slovenia (ESS) 
reports that registered unemployment rose from 66,239 at 
the end of 2008 to 86,481 at the end of June, 2009 
exceeding the level at the end of 2006.  While data on 
registered unemployment shows that the unemployment growth 
trend is slowing down, according to the Institute of 
Macroeconomic Analysis and Development of the Republic of 
Slovenia's (IMAD) forecast, Slovenia could be facing up to 
100,000 unemployed persons by the end of 2009, the same 
level that it was at in the end of 2002. ESS reports that 
in the first quarter of 2009, 19,610 new work-permits were 
issued which is 9% less compared to 2008 data.  Demand for 
work from employers in the first six months of this year is 
down 37.3% compared to the same period last year.  ESS 
reports that there were 11,964 job vacancies open in April, 
2009, which is the lowest figure this year, and down 44.7% 
compared to April, 2008.  The government announced in July 
2009 that it was drafting new legislation on employment 
that will also address foreign workers. 
 
Nationalities and Sector breakdown of Foreign Workforce in 
Slovenia 
--------------------------------------------- ------ 
¶3. (SBU)  ESS reports that the industries affected most by 
the global financial crisis are construction, manufacturing 
and transport services, the same industries predominantly 
employing foreign workers in Slovenia.  A breakdown of 
valid work-permits by industry in May, 2009, shows that 50% 
of foreign workers were employed in construction, 12% in 
manufacturing, 6% in transport and warehousing and 4% in 
catering.  An analysis of valid work-permits by workers, 
nationality shows that 95% workers came from ex-Yugoslavian 
territories: 48% of the work-permits were issued to 
applicants from Bosnia and Herzegovina, followed by Serbia 
and Montenegro (16%) and Kosovo and Macedonia (10% each). 
Taking into account the growing unemployment rate in 
Slovenia and currently valid work-permits, demand for 
foreign workers could be down by 50% in 2009.  This means 
that approximately 22,500 workers from Bosnia, 12,000 from 
Serbia and Montenegro, and 4,500 from Macedonia and Croatia 
could lose their jobs, and close to that number of families 
could lose their primary source of revenue.  Foreign 
workers without employment are expected to return to their 
home country. 
 
Reducing Work-Permits 
--------------------- 
¶4. (SBU)  The GoS adopted a decree that limits the issuance 
of new work-permits from 24,600 in 2008 to 24,000 in 2009. 
The 24,000 does not include EU, EA, or Swiss foreigners and 
the count varies from month to month as work permits 
expire.  The decrees changes the structure of quotas, 
however; work-permits for the employment of foreign workers 
were decreased from 20,900 in 2008 to a maximum of 11,000 
in 2009, while the number of work-permits for seasonal 
hiring was increased from 8,000 to 10,300 according to the 
Official Gazette of R. Slovenia.  At the end of May 2009, 
the GoS issued a total of 30,598 new work permits, but only 
11,000 of these are subject to quota restriction.  The 
current provisions of the law includes various exceptions, 
which make the actual number of issued work permits 
 
difficult to regulate. 
 
Comment 
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¶5. (SBU) The opposition parties' criticism that labor 
legislation does not protect Slovenian workers sufficiently 
appears to ring true in this time of economic crisis. 
Nobody is advocating kicking out foreign workers, but they 
want to ensure that Slovenes get any newly created jobs. 
If unemployment rises to more than 100,000, then the 
possibility for labor unrest and protests would rise. 
 
FREDEN 
FREDEN