Croatia faces an urgent demographic challenge with a declining population and an ageing society. The country has lost nearly 400,000 residents over the last decade, placing it among the top five EU nations with falling populations. The proportion of elderly individuals aged 65 and over has increased from 17.9% in 2012 to 22.5% in 2022, and forecasts suggest it could reach 30% by 2050. In addition to demographic shifts, Croatia is experiencing persistent labor shortages. Since 2016, job vacancies have consistently exceeded the number of unemployed individuals, and projections indicate a need for over 300,000 workers by 2035.
To address workforce challenges, immigration has become a viable solution. Currently, foreign-born residents make up 12.7% of the population, with a noticeable rise in labor immigration. First-time work permits for foreign citizens increased from under 10,000 before 2016 to nearly 80,000 in 2023. Migrants play a crucial role in filling labor gaps and supporting the welfare system, particularly in construction, tourism, hospitality, and manufacturing sectors. However, issues such as lack of information, skills mismatches, language barriers, and cultural differences hamper the full integration of migrants.
The report, "Leveraging Immigration for Croatia's Prosperity," examines Croatia’s immigration system and offers strategies to optimize immigration's positive effects while tackling economic challenges.
Recommendations from the report propose several policy actions:
1. Strengthening immigration governance: Developing a holistic migration strategy with detailed action plans and funding could attract, train, and integrate foreign workers. Expanding labor and social security agreements and implementing Global Skills Partnerships may address skills needs and mitigate brain drain.
2. Enhancing regulations: Establishing recruitment agencies' licensing and monitoring will reduce migrants’ costs and enhance legal protection. Effective monitoring and enforcement are needed to ensure employer compliance with labor laws.
3. Aligning the selection process with labor market needs: Improving the labor market information system with forecasts of skill and occupation demands could refine migrant selection. A more transparent, trackable, and streamlined process is vital.
4. Ensuring effective skills matching and integration: Detailed job information in native languages, recognition of foreign qualifications, and expanded integration support through orientation programs, language training, and labor market access could improve recruitment and integration. Multi-channel service centers could provide multilingual assistance.
5. Leveraging technology and data: Enhanced data collection and digital solutions could improve the overall migration system.
The report emphasizes the importance of using immigration as a strategic human resource measure to address labor shortages and promote sustainable economic growth. Implementing these policy measures could create an effective immigration system that benefits both native and migrant populations while supporting Croatia’s long-term development objectives.