This chapter provides an overview of key trends in Slovenia’s labour market and the main features of its system of active labour market policy (ALMP) provision, setting the stage for the analyses in the following chapters. It shows that the Slovenian labour market has made significant progress, but that structural challenges remain. Spending on ALMPs is low in Slovenia, with a comparatively strong focus on employment services and direct job creation programmes. While Slovenia has a solid ALMP monitoring system, counterfactual impact evaluations are needed to generate in-depth insights into the effectiveness of different ALMPs.
Impact Evaluation of Wage Subsidies and Training for the Unemployed in Slovenia
Abstract
The Slovenian labour market has made significant progress over the past decade, eventually achieving a strong recovery after the protracted stagnation following the 2008 global financial crisis. Today, Slovenia has high employment rates and low unemployment compared to other OECD and EU countries. However, this favourable picture masks structural challenges, including an ageing workforce and a significant gap in labour participation across demographic groups. These challenges highlight the need for well-performing active labour market policies (ALMPs) that can address the barriers faced by jobseekers and ensure that Slovenia maximises the potential of its labour force.
This introductory chapter provides an overview of Slovenia’s current labour market situation and its system of ALMP provision, setting the stage for the in-depth analyses in the following chapters. Section 2.2 discusses the Slovenian labour market, depicting the progress that has been made over the last years and identifying persisting challenges. Section 2.3 introduces Slovenia’s ALMP system, discussing ALMP spending, the main institutions involved in the provision of ALMPs, financing of ALMPs and ALMP monitoring and evaluation.
Building on this chapter, the following chapters in the report present results from counterfactual impact evaluations of Slovenia’s ALMPs, providing evidence on which programmes are most effective in fostering labour market prospects, reducing unemployment, and improving social outcomes.
This section reviews some of the key features of Slovenia’s labour market, placing them in the context of other OECD countries. It analyses key labour market indicators such as employment, labour market participation, and unemployment, before looking further into how broad labour market trends vary across various population groups.
2.2.1. The Slovenian labour market has been making progress
In the aftermath of the 2008 global financial crisis, Slovenia experienced a rapid increase in unemployment, with unemployment rates rising more than in other OECD countries. However, since then the labour market has recovered remarkably well. Overall, in recent years the Slovenian labour market has been characterised by low unemployment and high employment, as well as robust labour market participation rates. Declining from its annual peak of 10.2% in 2013, Slovenia’s unemployment rate has fallen 6.8 percentage points and reached a record low level of 3.4% in 2023 (Figure 2.1). The COVID‑19 pandemic temporarily interrupted the positive labour market trends, but about two years after the outbreak of the pandemic, Slovenia’s unemployment rate returned to its pre‑pandemic level of December 2019. Developments in late 2024 point to an uptick in unemployment – which increased to 4.3% in the third quarter of 2024 – but the unemployment rate in Slovenia remains low from a historical perspective (Eurostat, 2025[1]).
Unemployment rates among persons aged 20‑64, 2000‑23
Note: OECD and EU27 are weighted averages.
In addition to low unemployment, employment rates are relatively high. In 2023, Slovenia’s employment rate of adults aged 20‑64 stood at 77.5%, 3 percentage points higher than across OECD countries (Figure 2.2), as well as 2.1 percentage points higher than the EU average. Slovenia’s high employment rate is also linked to high labour market participation (80.2%), which was 2.1 percentage points above the OECD (78.1%) and 0.2 percentage points above the EU (80%) averages in 2023. Employer surveys indicate that employers anticipate an employment growth of 1.4% in 2025, suggesting that both employment and labour force participation levels will likely remain high, at least in the short to medium term (ESS, 2024[2]). Despite these very favourable developments, Slovenia is not yet among the OECD countries with the highest employment and labour force participation rates, suggesting that further progress is possible.
Employment and labour force participation rates among 20‑64 year‑olds, 2013, 2019 and 2023
Note: OECD and EU27 are weighted averages. Countries are ranked by 2023 data.
With the tight labour market, vacancies are more difficult to fill
At the same time, Slovenia’s strong labour market recovery has resulted in tighter labour market conditions. High employment and low unemployment levels have made it more difficult for employers to fill job vacancies. Job vacancies had been on the rise before the COVID‑19 pandemic, and while the crisis brought this trend to a temporary halt, job vacancies started to increase again during the recovery period. Job vacancy rates1 in Slovenia then spiked during the recovery from the pandemic at 3.3% in the second quarter of 2022 (Eurostat, 2025[3]), above the EU average of 3.0%, reflecting difficulties to fill open positions. More recent statistics point to less tight labour markets, with the job vacancy rate at 2.4% in the third quarter of 2024, but still high compared to pre‑pandemic levels.
Population ageing is an important factor that will likely contribute to a tight labour market in the longer run. Slovenia’s working-age population is projected to decrease by 12% between 2024 and 2050, which marks a steeper decline than in most other OECD countries. In addition, the share of those aged 65 and above is set to increase by over 40% over the next 25 years, to make up nearly one‑third of Slovenia’s population. These strong trends will have direct consequences on labour supply and could lead to increased competition for workers, rising wage pressures, and challenges in maintaining productivity and economic growth without strategic interventions to bolster workforce participation.
Migration flows are another relevant feature of the labour market in Slovenia. Combined migration flows of employed individuals – inflows and outflows – amounted to 31 273 in 2023 (SORS, 2023[4]). As a share of the population in employment, inflows and outflows amounted to 2.0% and 1.1% of employment, respectively. While these statistics were slightly higher than in prior years, partly reflecting recovery from the pandemic in mobility terms, net migration has been contributing to an increase in employment in Slovenia in recent years.
2.2.2. Large labour market disparities exist between different groups of the population
In spite of strong labour demand and low unemployment for the last couple of years, there are groups who would benefit from additional measures to be able to actively participate in the labour market. The long-term unemployed, younger and older jobseekers, and people with low educational attainment are among those who have the biggest difficulties finding employment. These groups of jobseekers are also more likely to face multiple types of labour market barriers simultaneously and often become discouraged from active job search, exiting the labour market and becoming inactive.
Long-term unemployment is a challenge in Slovenia
In contrast to low unemployment rates overall, long-term unemployment – which refers to people who have been unemployed for at least 12 months – remains a major challenge, despite having decreased by 24 percentage points (as a share of all unemployed) between 2000 and 2023. Much above the OECD average of 22.5%, the long-term unemployed accounted for 37.7% of unemployed persons in Slovenia in 2023 (Figure 2.3). While the overall long-term unemployment rate is below the EU average in Slovenia (Eurostat, 2025[5]), this relatively high share of long-term unemployment out of total unemployment points to entrenched difficulties for people to re‑enter the labour market after extended unemployment spells, contrasting with the overall robustness of the Slovenian labour market. While long-term unemployment used to be more pronounced among men than among women, the long-term unemployment rate was virtually identical for both genders in 2023.
Slovenia’s unemployment benefit system includes safeguards to avoid financial incentives to stay unemployed – such as benefit ceilings, gradually decreasing replacement rates, and provisions for combining benefits with new employment. In addition, there is a need for robust and tailored ALMPs to support effective workforce reintegration and address barriers that prevent long-term unemployed individuals from returning to stable employment.
Long-term unemployment as a share of all unemployed, persons aged 15+, 2019 and 2023
Note: Long-term unemployment refers to persons unemployed for one year and over. OECD and EU27 are weighted averages.
Raising employment rates for younger and older individuals is necessary
Young and older people are groups that are underrepresented in the Slovenian labour market. In particular, the employment rate among older workers stands out as very low. In 2023, only 54% of 55‑64 year‑olds worked in Slovenia, well below the OECD average of 64% (Figure 2.4). While Slovenia’s employment rate amongst 55‑64 year‑olds has increased significantly over the past 10 years – largely due to a gradual tightening of eligibility conditions following a pension reform introduced in 2012 (OECD, 2022[6]) – additional measures may be needed to further increase the employment rate of workers in this age group. Older workers often face skill mismatches, particularly as the demand for digital skills increases, which can make it harder for them to find suitable employment. In addition, age‑related health issues and limited access to reskilling and upskilling opportunities further reduce their employment prospects. The low employment levels among older people represent a missed opportunity, as their skills and experience could contribute to a more resilient and inclusive labour market and help address potential labour shortages.
The employment rate among young people aged 15‑24 is also low, at 33% in Slovenia compared to 43.5% in the OECD in 2023. One factor behind this low rate is that many young people are enrolled in higher education, which has positive implications for future labour market developments and has arguably contributed to decreasing inequality in Slovenia (Laporšek et al., 2021[7]). Indeed, the share of young people (aged 15‑29) not in employment, education, or training (NEET) in Slovenia remains at 8.4% well below the OECD average (Figure 2.5). Nevertheless, even though the NEET rate is lower than in other countries, activating this group is crucial and comes with its particular challenges. For example, a recent mapping of NEETs based on administrative data finds that more than half of all NEETs in Slovenia are not registered with the Employment Service of Slovenia (ESS), highlighting how difficult it can be to establish a contact with this group (OECD, 2021[8]).
Employment rates among 55‑64 year‑olds, 2013, 2019 and 2023
Note: OECD a weighted average. Countries are ranked by 2023 data.
Share of 15‑29 year‑olds not in employment, education or training (NEET), by work status, 2023
Note: OECD is an unweighted average and excludes Chile, Japan and Korea. Data refer to 2022 for Chile.
Lower educated jobseekers have more difficulty obtaining employment in Slovenia
In Slovenia, persons with primary education have a substantially lower employment rate (55.2%) than those with secondary (78.7%) and tertiary (92.9%) education (Figure 2.6). Compared to the OECD and EU averages, the employment gaps between people with different education levels are large. As a result, employment levels of people with low educational attainment in Slovenia are well below the OECD average, while they are well above the OECD average for people with tertiary education. This discrepancy highlights the need for targeted policies to improve labour market outcomes, especially for those with lower educational attainment. In addition, it also stresses the need to strengthen access to upskilling and reskilling programmes, including for individuals with low educational attainment, to enhance both individual economic prospects and overall workforce productivity.
Employment rates by educational attainment levels, 25‑64 year‑olds, 2023
Note: Education levels based on ISCED 2011. Low: persons with less than lower secondary education (ISCED levels 0‑2), middle persons with upper secondary and post-secondary non-tertiary education (ISCED Levels 3 and 4) and higher: persons with tertiary education (Levels 5‑8). OECD is an unweighted average and excludes Japan.
According to the OECD Dashboard on priorities for adult learning, there is a strong case for increasing expenditures on adult learning in Slovenia (OECD, 2020[9]). Several indicators point to the need of updating the skills of adults, including a high share of adults with poor ‑problem-solving skills in technology-rich environments (48%), a high share of workers in occupations facing a significant risk of automation (53%), and a high share of business sector jobs sustained by foreign final demand (55%). At the same time, the country had the second-highest percentage of adults, who wanted to participate in more training but did not do so due to costs (26%) among OECD countries. It seems that there is an implicit expectation that such services should be provided by the state in Slovenia, as expenditures on learning or training by both firms and individuals are low compared to other OECD countries. Boosting investment in adult education for unemployed people and training beyond their current levels would help address these gaps, especially regarding upskilling unemployed people in in-demand skills, such as green and digital skills (OECD, 2023[10]). According to the EU adult education survey, Slovenia’s share of adults who report having participated in education and training stood at 42% in 2022, 4 percentage points below the EU average, and also 4 percentage points lower than the level from the prior survey, in 2016 (Eurostat, 2025[11]).
The previous section illustrates that despite having good employment rates in the current strong labour market climate, there are still underlying challenges in Slovenia to help support certain groups of jobseekers into work, such as the long-term unemployed and older jobseekers. In this context, having a set of ALMPs that fit within the broader offer of social services and align with education policy to support these jobseekers is essential. This section discusses how the main stakeholders in Slovenia’s ALMP system deliver these policies, and reviews the composition of ALMP spending and participation and how ALMPs are monitored and evaluated.
2.3.1. The Employment Service of Slovenia manages the practical implementation of ALMPs
The Ministry of Labour, Family, Social Affairs, and Equal Opportunities (MoLFSA) and the Employment Service of Slovenia (ESS), the Slovenian PES, are the key stakeholders in the Slovenian ALMP system. The MoLFSA holds the central role in policy design, while the ESS along with other smaller providers manage the practical implementation of ALMPs.
The ESS is a public agency directly reporting to the MoLFSA and is steered by a tripartite board that consists of 13 members, representing employers and trade unions (three members each), the government (six members) and the ESS workers’ council. The ESS has 58 local offices and 12 Career Centres around the country and combines the functions of job-brokerage, employment counselling, referrals to active measures, administration of unemployment insurance benefits, provision of life‑long career guidance, and issuance of work permits to foreign workers.
Although they have decreased in recent years, counsellor caseloads remain high in Slovenia. The number of clients per ESS counsellor stood at 256 in April 2024. This is a slight improvement compared to some previous years (it stood at e.g. 271 in April 2023) and a considerable improvement since its peak in 2013, when austerity-driven staff cuts resulted in a ratio of over 400 (OECD, 2016[12]). Some ESS staff are hired based on project-specific funding, leading to fluctuations in the number of counsellors in addition to fluctuations in the number of registered unemployed.
While direct comparisons of counsellor caseloads across OECD countries are challenging due to differences in the roles of PES and their responsibility, rough estimates suggest that caseloads in Slovenia are considerably higher than in many other OECD countries, particularly those with modern and well-performing ALMP systems (see e.g. Lauringson and Lüske (2021[13])). For example, in 2022, counsellors supporting individuals further from the labour market had caseloads of approximately 100 jobseekers per counsellor in Denmark, Germany, and Flanders (Belgium), and 150 in France (Bourguignon et al., 2023[14]). At the same time, counsellors assisting jobseekers closer to the labour market managed 100 jobseekers per counsellor in Denmark and 150 in Germany. Evidence from evaluations in Germany highlights that low caseloads –as low as 70 to 80 jobseekers per counsellor, and even 40 in a 2007 pilot –are particularly effective for supporting vulnerable groups and facilitating their integration into the labour market (Hainmueller et al., 2016[15]; Staible, 2017[16]). Similarly, a randomised controlled trial in Austria in 2015, which reduced caseloads from 250 to 100, demonstrated that jobseekers returned to paid employment more successfully when caseloads were lower (Böheim, Eppel and Mahringer, 2017[17]).
The high counsellor caseloads are especially challenging in terms of providing more in-depth support to clients. While meeting frequencies are higher early on in unemployment spells because meetings to establish an individual action are mandatory for all registered unemployed, meeting frequencies are in fact lower for individuals needing intensive support compared to other groups of jobseekers throughout their unemployment spells. On average, jobseekers classified as “Employable with intensive support” have one meeting every 3.9 months (Figure 2.7), compared to once every 3.6 months for those classified as “Employable with additional support” and once every 2.2 months for those classified as “Directly employable”.2
Meeting frequency by jobseeker’s counsellor-assessed employability rating, Slovenia, 2023
Note: Jobseeker employability is assessed at every meeting counsellor-jobseeker meeting, so a jobseeker’s rating can change over time based on counsellor assessments. Statistics for individuals with unknown employability ratings – mostly because the first meeting has not yet occurred – are not included. The types of meeting included cover several types of meetings offered by the ESS: basic career counselling, first interview, basic career counselling at 12 months, in-depth career counselling, rehabilitation counselling, and health career counselling sessions. Of these, basic career counselling sessions account for the majority (roughly 80%) of the total sessions. Statistics for individuals classified as directly employable past 23 months are not included due to small number of observations.
Source: OECD calculations based on the data from the Employment Service of Slovenia (ESS).
The ESS is currently undergoing reforms to improve its service delivery and better support jobseekers in their integration into the labour market. One of the key changes is the plan to introduce a new profiling tool that leverages microdata to assess the skills and needs of job seekers more accurately. Unlike the current profiling system, which relies heavily on the discretion of employment counsellors, the new advanced tool will aim to provide a more consistent and data-driven approach to categorising jobseekers. It will take account of a wide range of individual characteristics and barriers, many of which are currently not captured in a systematic way. The new profiling model is currently in the planning phase. In addition, ESS is in the process of implementing a modern AI-based matching tool based on ESCO that will replace the existing, rules-based tool. The new tool will be designed to match job seekers with vacancies by taking into account a wider array of factors, including specific professional and personal skills and experience levels, enabling a more efficient and targeted job placement process. The new tool has already been piloted in several regional offices and is set to be rolled out throughout Slovenia in the near future.
Another key change at the ESS is the development and planned introduction of a platform for long-term skills forecasting. Using extensive microdata, this platform will project skill demand trends, helping the ESS anticipate future labour market needs. At the moment, ESS uses survey-based information to anticipate skill needs in the short and medium term (MoLFSA, 2023[18]). The new foresight model will play a key role in guiding the ESS’s efforts to design relevant training programmes and to match jobseekers with the most future‑ready job opportunities. By integrating this forward-looking approach, ESS will be able to ensure that its training initiatives are aligned with changing labour market needs and enable job seekers to gain skills that are in high demand.
2.3.2. Spending on active labour market policies in Slovenia is low and focused on employment services and direct job creation
ALMP spending as a share of GDP in Slovenia is well below the OECD average, limiting the resources available to support jobseekers. In 2022, Slovenia spent only 0.18% of its GDP on ALMPs, slightly above one‑third of the OECD average of 0.43% (Figure 2.8). Among European OECD countries, only the Slovak Republic and Latvia spent less on ALMPs than Slovenia compared to their GDP. This indicates that there is scope to increase expenditure on ALMPs in Slovenia to provide additional support to jobseekers, foster greater social inclusion and alleviate labour shortages.
Although ALMP spending has been below the OECD average for a long time, ALMP expenditures have tended to decrease over time, from 0.24% of GDP in 2015 and 0.2% in 2019 just before the COVID‑19 pandemic, to 0.18% in 2022, which is the lowest level since 2008. Positive labour market trends are one factor behind this development, as the number of unemployed people has continued to decrease, with the unemployment rate falling to the lowest level in decades. However, even when expressed as spending per unemployed person, ALMP expenditures in Slovenia are modest compared to other countries.
The composition of ALMPs in Slovenia contrasts with other OECD countries (Figure 2.8, Panel B). In 2022, Slovenia dedicated a larger share of its ALMP spending to PES administration and employment services – such as counselling, job search assistance, and labour market information – at 39.1% compared to the OECD average of 27.5% (however, given the low level of spending on ALMPs in general, this still results in the low counselling frequency rates described in Section 2.3.1). It also invested more in direct job creation programmes (17.3% vs. 8.8%). The relative importance of training programmes (22.3% against 24.7%) and employment incentives (19.6% against 14.5%) is similar to the OECD average, whereas spending on sheltered and supported employment and rehabilitation is much lower (1.7% against 22.0%).3 Start-up incentives are not used in Slovenia anymore (0% against 2.5% in the OECD).
While the exact annual numbers for 2022 are influenced by changes in the level of available EU funds in this year, these broad patterns are persistent over longer time periods. On average between 2017 and 2022, the relative share of Slovenia’s ALMP spending (among total ALMP spending) was well above the OECD average for PES administration and employment services (34.6% against 20.4%) and direct job creation programmes (20.1% against 8.9%), while it was similar for training programmes (19.6% against 18.9%). Conversely, it was below the OECD average for employment incentives (22.8% against 33.7%), which was however largely influenced by temporary measures linked to the COVID‑19 pandemic, as well as for sheltered and supported employment and rehabilitation (1.6% against 15.9%) and for start-up incentives (1.2% against 2.2%).
Spending on active measures as a share of GDP, 2022
Note: In Panel A, OECD is an unweighted average of the 35 member countries shown. Data refer to 2020 (Italy) and 2021 (Greece, Ireland, Israel). Category 4.2 relates to temporary employment maintenance incentives which were dramatically affected by exception measures to address the challenges of COVID‑19 and is excluded from this comparison.
Expenditure (in EUR million, constant 2010 prices) and change (%) in expenditure by ALMPs and selected active labour market measures
Note: Where values are missing this is noted as n/a. The scope of the LMP database is limited to interventions that are explicitly targeted at groups of persons with difficulties in the labour market: the unemployed, persons employed but at risk of involuntary job loss and persons currently considered as inactive persons but who would like to enter the labour market.
Source: Labour Market Policy Database, European Commission, Directorate‑General for Employment, Social Affairs and Inclusion (DG EMPL).
Slovenia has taken steps to improve its ALMP offer. For example, the strong focus on employment services is promising, as these services are generally low-cost and effective in facilitating quick job placement. Furthermore, Slovenia increased the share of ALMP expenditures allocated to training, recognising that well-structured and targeted training programmes can be highly useful to reduce labour market barriers, including among people facing a large distance to the labour market. Nevertheless, overall spending on training remains still quite low.
While this progress is notable, some aspects of the ALMP composition require further attention. For example, despite significant decreases, Slovenia still allocates a large share of ALMP spending to direct job creation programmes. International literature suggests that these programmes tend to be less effective in improving labour market prospects of participants compared to other types of programmes (Card, Kluve and Weber, 2017[19]). Furthermore, a past evaluation of Slovenia’s main ALMPs found that its direct job creation programme was the only ALMP without positive, long-term effects (Burger et al., 2021[20]). While there are examples of successful direct job creation programmes, they typically require precise targeting and must avoid direct competition with the open labour market, and even then, they may underperform other types of interventions (OECD/Department of Social Protection, Ireland/EC-JRC, 2024[21]). In addition, although the relative importance of training within the ALMP offer has increased, participation in training remains low. Spending on labour market training is still less than half of the OECD average in Slovenia (0.04% of GDP, as compared to 0.10% of GDP in 2022), and expressed in constant prices, spending on training has decreased by 31% over the last 10 years. In order to fund trainings, it is therefore commonplace for employees to rely on their employers, who can deduct training expenses from their tax liabilities.
2.3.3. Participation in ALMPs differs across groups, but uptake should be encouraged more among those facing challenges to labour market integration
Participation in ALMPs differs between men and women and across age groups. Overall participation numbers in ALMPs are similar for men and women, with 53% of participants being male and 47% female. However, women account for the vast majority of participants in training programmes (59%) and direct job creation programmes (66%), while men take part in employment incentive programmes more commonly (62% of participants). Young people under 25 represent 18% of all ALMP participants, but they are significantly overrepresented in training programmes (26%), while hardly any young jobseekers take up direct job creation programmes (3.3% of all participants). These differences show that specific types of ALMPs tend to attract distinct groups of jobseekers in Slovenia, potentially reflecting varied needs, interests, or perceived accessibility across age and gender.
Nevertheless, increasing uptake of ALMPs – particularly in employment and training subsidies – could lead to stronger employment outcomes for groups facing major labour market barriers. Given Slovenia’s favourable labour market conditions, refining ALMP targeting could be an important step to bring those harder to reach, such as jobseekers with lower levels of education and older individuals, closer to the labour market. As shown in Chapter 3, these are precisely the groups of individuals who are least likely to engage in training, even though the evaluation results (presented in Chapter 4), show they would benefit from them.4 Enhancing access to training specifically for individuals with lower educational attainment, for example, could help bridge skill gaps and increase their employability. Tailoring ALMPs to align more closely with the specific needs of vulnerable groups would allow Slovenia to reduce employment disparities and better leverage the potential of its entire workforce.
2.3.4. ALMPs are financed through a mixture of EU, national and local funding sources
The European Commission’s Labour Market Policy (LMP) database collects data on expenditure and participation for interventions targeting persons who are unemployed, employed-at-risk and inactive who would like to enter the labour market5 and includes breakdowns for specific LMP target groups. Of these labour market policy interventions, national and regional programmes proposed by the Member States and approved by European Commission decisions can be co-financed by the European Structural Funds (ESF and now ESF+) (Box 2.1). Overall, ESF financing is provided by the EU to improve employment and education opportunities, skills, and social inclusion across its Member States. In 2021, out of the 35 labour market policy interventions recorded for Slovenia in the database, over 40% included co-financing through ESF+6 together with central government funding. The role of local government in funding interventions is, however, much more limited. In terms of types of LMPs, ESF+ financing was in particular drawn on for interventions including formal education programmes, on-the‑job training, and employment incentives for young unemployed persons. Other programmes funded through ESF+ included learning workshops and wage subsidies for workers in short-time work schemes.
ESF funding is an important way of complementing national funding for ALMPs in Slovenia. However, Slovenia could aim to further diversify its funding sources in order to ensure stable funding levels for effective ALMP provision. In the period from 2019‑23, funding for ALMPs in Slovenia has varied considerably (Figure 2.9). In 2023, for example, funding for training dropped by more than 50%, with only 10% of this decrease attributable to a drop in funding from the national budget. Other ALMPs were also affected by the lower level of funding in 2023, although the drop in funding for PES operations from other sources was partly offset by an increase in funding from the national budget. Such fluctuations in funding can make it difficult to operate and administer ALMPs.
The European Social Fund Plus (ESF+) is the European Union (EU)’s main instrument for investing in people and supporting the implementation of the European Pillar of Social Rights. The ESF+ brings together four funding instruments that were separate in the 2014‑20 programming period: the European Social Fund (ESF), the Fund for European Aid to the most Deprived (FEAD) the Youth Employment Initiative and the European Programme for Employment and Social Innovation (EaSI). With a budget of almost EUR 99.3 billion for the period 2021‑27, the ESF+ provides an important contribution to the EU’s employment, social, education and skills policies, including structural reforms in these areas.
For the 2014‑20 programming period, the ESF was allocated EUR 74 billion to co-finance national or regional operational programmes to promote sustainable and quality employment, labour mobility, social inclusion, investments in education, training and lifelong learning and enhancing the institutional capacity of public authorities and stakeholders. The European Commission and EU countries in partnership set the Fund’s priorities and how it spends its resources. It is one of the key EU instruments for the socio‑economic recovery from the coronavirus pandemic.
The ESF has been supporting ALMP funding since Slovenia’s entrance into the EU in 2004. From 2021‑27, the EU will invest EUR 665 million in ESF+ funding in Slovenia for upskilling, ALMPs and lifelong learning to help people prepare for the green and digital transition, for improving the working conditions of older workers by training employers and adapting workplaces, and for enhancing social inclusion. Young people with special needs will get support to access education and the labour market. For the period 2021‑27, a total of EUR 114.9 million is allocated from ESF+ for the active labour market measures in Slovenia. In 2024, EUR 67.8 million of funds are earmarked for active labour market policies through the European Social Fund within the 2021‑27 financial perspective (IMAD, 2023[22]).
Source: European Commission (2023[23]), European Social Fund Plus, https://ec.europa.eu/european-social-fund-plus/en (accessed on 04 December 2023); IMAD (2023[22]), Development Report 2023, www.umar.gov.si/fileadmin/user_upload/razvoj_slovenije/2023/angleski/A_POR2023.pdf, (Accessed on 04 December 2023).
Funding sources for selected ALMPs implemented by ESS, 2019‑23
ALMPs: Active labour market policies.
Note: The majority of the funding under the heading “European Social Fund and other sources”, 85.9%, was from the European Social Fund (which also includes funding from the European Social Fund+). “ESS operations” includes wages and material expenses.
Source: Employment Service of Slovenia annual reports (various years).
2.3.5. A limited number of counterfactual impact evaluations of ALMPs have been conducted in Slovenia but progress is being made
Currently, analyses of the effectiveness of ALMPs in Slovenia consist of regular monitoring of ALMPs complemented by ad hoc counterfactual impact evaluations (CIEs). While the regularly conducted analyses are useful, expanding them to include CIEs would help better inform changes to their design, improve targeting to ensure they are accessible to the groups who need and benefit from them the most, and provide concrete evidence to justify additional expenditures into programmes based on their cost-effectiveness.
MoLFSA and the ESS have an extensive framework in place for monitoring activities, outputs and gross outcomes relating to ALMPs. Relevant analyses include regular internal reports and presentations produced by the ESS analytics office (e.g. ESS (2018[24]; ESS, 2018[25]; ESS, 2021[26]) and the Annual Report on Labour Market Policy measures published by MoLFSA (e.g. (MOLFSA, 2024[27])) and other analyses (e.g. (MoLFSA, 2021[28])). Indicators used for monitoring include client survey indicators, statistics on ALMP participation and completion and statistics on transitions into employment. While the regular analyses of ALMPs currently conducted in Slovenia are useful for monitoring purposes, they do not identify the causal effects of the policies.
Periodically, ALMPs in Slovenia are subject to CIEs, which are able to identify and quantify causal impacts. Examples of this are research projects by the University of Primorska (Burger et al., 2021[20]) as well as unpublished research on counselling programmes commissioned by MoLFSA. The remaining chapters of this report add to these efforts, providing up-to-date CIEs of various ALMPs in Slovenia thereby filling the knowledge gap on the effectiveness of these programmes. Chapter 4 presents the results for institutional training and Chapter 5 the results of the evaluation of employment incentives. In addition, following this report, a cost-benefit analysis of ALMPs in Slovenia will be carried out, as well as impact evaluations of direct creation programmes and on-the‑job training.
References
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← 1. The job vacancy rate measures the gap between the number of job vacancies and the sum of the vacancies and occupied posts. Quarterly data on job vacancy rates are collected by Eurostat since 2008.
← 2. The meeting frequencies for different groups of jobseekers should be interpreted with caution given that institutional factors mean that meetings are more likely to occur at certain points in the unemployment spell, such as at the very beginning. For example, many of the jobseekers classified as “readily employable” become employed quickly – possibly immediately after their mandatory initial meeting in the first months of their unemployment spell.
← 3. Several measures for individuals with disabilities, as outlined in the Vocational Rehabilitation and Employment of Persons with Disability Act, are not captured in the data. These include systemic, continuous practices such as employment rehabilitation and social inclusion programmes. As the majority of people with a disability are supported through measures under this law, there are limited special ALMP programmes to avoid overlaps. In addition, there is a binding quota system in Slovenia requiring companies to employ individuals with disabilities or pay a levy.
← 4. Results from other countries also show that often the groups who benefit from ALMPs the most from are less likely to participate. For example, an evaluation of Lithuania’s ALMPs had especially positive effects on the employment of older workers (compared to younger workers), but that older workers were less likely to participate (OECD, 2022[29]). Similarly, in Greece, older workers received the largest increase in earnings from participating in wage subsidies – but they were less likely than their younger counterparts to participate (OECD, 2024[30]).
← 5. The scope of the LMP database is limited primarily to interventions which are explicitly targeted in some way at groups of persons with difficulties in the labour market. The three main target groups are the unemployed (persons usually without work, available for work and actively seeking work), those employed at risk of unemployment (persons currently in work but at risk of involuntary job loss due to the economic circumstances of the employer, restructuring, or similar), and those who are inactive (persons currently not part of the labour force in the sense that they are not employed or unemployed according to the definition above) but who would like to enter the labour market and are disadvantaged in some way.
← 6. However, it is to be noted that this is not to be equalised with 40% of funding stemming from ESF interventions and certain interventions reported in the LMP database may actually be an aggregation of multiple similar interventions belonging to a particular LMP category.