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Impact of Immigration and Population Change on Economic and Social Development in Slovenia

Slovenia is a relatively small country with a population of around 2 million and is therefore very vulnerable from a demographic point of view. Slovenia faces a low birth rate, and the existing natural growth will not be sufficient for the current economic, employment and pension model, the aging of the population, the emigration of the Slovenian workers, and also the critical shortage of labour in various sectors of the economy. Traditionally, the main influx of economic migrants in Slovenia has been from the former Yugoslavia (to which Slovenia belonged until its independence in 1991): Bosnia and Herzegovina, Kosovo, Northern Macedonia, Croatia, Serbia, etc. For refugees and irregular migrants Slovenia is mainly a transit country and not an interesting final destination. Based on existing demographic and socio-economic data, it can be summarized that Slovenia needs immigration to ensure stable and sustainable social and economic development.

In Slovenia, various and differently intense social and population changes have been observed in the last decade. Statistical data show that the population in Slovenia is growing steadily, but still relatively slowly. Slovenia has had about 2 million inhabitants since its independence in 1991. In the years from 2010, the number of inhabitants has increased from 2,046,976 to 2,095,861 in 2020, i.e. by almost 50 thousand. However, the Slovenian age structure is moving towards an older population structure; the median age increased slightly each year, reaching 41.4 years in 2010 and rising to 44.1 years by 2020. Accordingly, the old-age dependency ratio increased every year, from 23.8 in 2010 to 31.3 in 2020. The indicator refers to the ratio between the number of people aged 65 or more (considered retirement age, the period of inactive years) and the number of people aged 15-64 (considered active years). The value is given per 100 people of working age (15-64). The growth in this ratio means that each year there are more people of retirement age compared to those of working age – the population is ‘ageing’, which brings with it the need for more active/working people. Therefore, in order to secure the current economic system of work and retirement, birth rates should be increased (in the last ten years the birth rate in Slovenia has averaged 1.58 and will be being 1.57 in 2010 and 2020) and/or an appropriate immigration policy should be pursued in combination with an appropriate integration policy. Looking only at natural growth, we notice a constant decrease, which was even negative in 2017 and 2018, but on the other hand, the population has still grown due to immigration.

In 1991 Slovenia gained its independence, which brought about some important changes in migratory movements. Even as an independent state, Slovenia remained linked to the republics of the former Yugoslavia in terms of migration, as more than 80% of immigrants (both economic migrants and refugees) in the 1990s came from the countries of the former Yugoslavia. After the Balkan war, it is estimated that Slovenia offered temporary protection to a total of about 60,000 persons from Bosnia and Herzegovina (1993-1995) and 25,000 from Croatia (1991-1992). After independence in 1992, almost 200,000 citizens of other republics of the former Yugoslavia were granted Slovenian citizenship. According to available statistical data, about 360,000 persons immigrated to Slovenia in the period 1954-2000, while about 200,000 persons left the country. Immigration from the former Yugoslav republics continued to be predominant after Slovenia joined the European Union in 2004. In 2015, Slovenia became one of the countries on the so-called Balkan refugee route. The Hungarian closure of the green borders in October led to a diversion of refugees to Slovenia, resulting in 326,956 refugees passing through Slovenia between 20 October and 15 December 2015[2]. A significant increase in arrivals and the impossibility of carrying out repatriation and readmission procedures forced the Slovenian authorities to facilitate the humanitarian corridor, notwithstanding the applicable legal provisions[3]. According to the Ministry of Interior, 2875 asylum applications were filed in 2018, 3821 in 2019 and 3548 in 2020, but the number of granted asylum applications remains low, 102, 85 and 82 respectively. The current migration challenges in Slovenia are mainly related to anti-immigrant, racist and xenophobic statements. However, anti-immigrant sentiments are mainly directed against refugees and less against economic migrants.

Slovenian strategy of Economic Migration

The Slovenian Economic Migration Strategy for the period 2010 to 2020 has emphasised that natural growth in Slovenia will not be sufficient for the current economic-employment-pension model. The current strategy of the Government of the Republic of Slovenia in the area of migration from 2019 onwards outlines that Slovenia must respond prudently to the challenges posed by the ageing population and the increasing emigration of the labour force.

Slovenia is part of the global migration trends, and this is also shown by the statistical data. According to the Statistical Office of the Republic of Slovenia, in 2017 the net migration of foreign nationals was positive for the nineteenth consecutive year: in 2018, 17,355 more immigrants entered Slovenia than left the country. The number of displaced foreigners is increasing rapidly after 2013, which affects the net migration of the total population. The number of valid permanent residents has also been steadily increasing over the past decade. The number of valid permanent residence permits has increased by about 50,000, an average of 5,000 per year. In 2018, 83,500 permanent residence permits were valid. With almost 64,500 temporary residence permits valid, the number in 2018 is the highest in the last ten years. At the end of December 2018, more than 176,000 foreigners held a valid residence permit or residence certificate in the Republic of Slovenia, including more than 148,000 non-EU citizens. Of the 148,014 valid residence permits held by third-country nationals, 83,542 were permanent residence permits and 64,472 were temporary residence permits. The valid temporary residence permits are mostly valid simple residence and work permits, followed by valid temporary residence permits based on family reunification and study.

According to various reports from recent years, the integration of third-country nationals into the labour market is mostly guided by the economic needs of the state and thus does not take into account current demographic trends. Integration of refugees into the labour market in general remains a challenge in Slovenia. Refugees face a number of systemic and practical obstacles. Slovenia is primarily considered a transit country and has relatively few refugees and asylum seekers, but nevertheless faces the challenge of introducing new measures to promote the integration of refugees into the labour market and society in general. Various challenges such as language and cultural barriers, but also systemic barriers – such as discrimination in the workplace, lack of diversity skills and lack of mechanisms to recognise education, qualifications and skills – hinder the successful integration of refugees into the labour market. Self-employment or (social) entrepreneurship of refugees is also currently not supported. Tailored subsidies could be a solution to address this problem.
In order to achieve long-term stable economic and social development, a more coordinated and planned immigration policy should be pursued. We already know which professions are most needed (the shortage professions) and which cannot be covered by the Slovenian population alone.

The shortage of specific skills on the national/regional labour market is primarily determined by the labour shortage identified by the Public Employment Service of the Republic of Slovenia, as it identifies which occupations are most needed.
This is then also the basis for issuing work permits to foreigners[4]. In Slovenia there are also “shortage occupations”; the shortage areas and educational programmes are determined by the Scholarship Policy (2020-2024) adopted by the Government of the Republic of Slovenia. The scholarships for shortage occupations[5] are intended to encourage young people to enrol in educational programmes for occupations for which there is a recognised shortage, as there is a shortage of workers for these occupations on the labour market. For 2021, the set of shortage occupations (and consequently the scholarships have been published in the following fields and educational programmes) includes: Stonemason, mechatronics technician, mechanical equipment installer, metal designer – toolmaker, electrician, vehicle body repairer, baker, confectioner/candy maker, butcher, upholsterer, carpenter, bricklayer/mason, plumber, tinsmith/sheet metal roofer, drywaller, painter and decorator, ceramic tile potter, forester, chimney sweep, glazier, glazing technician, but also nurses, doctors, caregivers, etc.

Socio-demographic and economic indicators indicating societal changes

Some socio-demographic indicators and economic and entrepreneurship indicators for Slovenia from 2010 to 2020 are presented in the table below, indicating societal changes.  However, not all data were available from 2010 and 2020 – in that case a different year is listed.

Source: cee