Although the number of insured persons has jumped by more than 300,000 in ten years, only 14,000 new jobs were created in the past year, signaling that the economy is slowing and approaching stagnation.
At the end of July this year, Croatia surpassed the 1.8 million insured persons mark for the first time in its history, a symbolic level reflecting the strong economic growth of the past decade. Compared to ten years ago, the number of insured persons has increased by more than 300,000, or nearly a quarter. However, behind this impressive figure lies a worrying trend of slowdown.
Despite July being the peak of the tourist season and traditionally a period of increased hiring, the pace of new job creation this year has been noticeably weaker. Over the past year, the Croatian labor market has gained only 14,000 new jobs, representing a growth in new employment of just 0.9 percent. This is the slowest growth rate since 2015, excluding the pandemic year of 2020.
The data clearly indicate that the labor market has hit its ceiling. Even the IT sector, which for years was a generator of new jobs, is no longer driving employment as it once did. The economy is slowing, and the trend is increasingly downward, moving toward stagnation.
Reaching 1.8 million insured persons represents an important symbolic milestone that Plenković's Government, according to estimates, will know how to leverage well in marketing its achievements. However, experts warn against excessive praise, as the underlying trend is concerning. The numbers show that the economy is cooling, and the labor market no longer has the momentum it had in previous years.
While the growth in the number of insured persons by nearly a quarter in ten years is undoubtedly a product of a strong economic cycle, current data showing an increase of only 14,000 jobs in a year suggest that this cycle is coming to an end.
