Azernews.Az

By Nigar Orujova

The World Bank encourages the development of the labor market in Azerbaijan to ensure an inclusive and sustainable economic growth in the country, says a report posted on the WB website.

The Azerbaijani government has taken a number of measures to improve the domestic labor market, including the reforms carried out with the support of the WB social security project.

The top priorities for Azerbaijan under the reform include improvement of labor market institutions and national employment services, providing favorable conditions for employment of young people immediately after completion of studies, and improvement of advisory services for building a career.

According to the report, the labor market improvement policy can be divided into three main areas: reducing the impact of certain problems on the labor market, which artificially reduces the demand for labor, development of stable labor market institutions, including those specializing in employment, as well as improving the quality of labor resources.

The WB said in its recommendations that in order to reduce the impact of problems that artificially reduce the demand for labor, firstly, it is necessary to reduce the non-compliance with formalities in the process.

Simplification of procedures and reduction of taxes levied for business start-up or expansion of the existing business are necessary in this regard; punitive action should be taken against employers using illegal labor; and public awareness should be increased regarding the negative impact of illegal labor on social protection.

National employment services should be improved to establish reliable institutions in the labor market. A single national computerized system which will contain information about all available vacancies and training programs and centers is to be created, the WB advised.

Improving the quality of human resources plays an important role in the development of the country's labor market. This area also requires certain action, including increased participation of the private sector in providing access to higher education. In addition, the government should spend funds on higher education in order to improve the quality of education, and to provide disadvantaged youth with greater access to higher education, the bank said.

According to Azerbaijan's State Statistics Committee, as of December 1, around 37,100 people were registered as unemployed in Azerbaijan, which has a population of 9.3 million. 42.1 percent of them are women.

There are two officially unemployed people per vacancy in Azerbaijan. As of December 1, around 4 678,900 million people were employed.

The poverty rate in the country is currently 7 percent, while the unemployment rate is 5.3 percent.

According to the Draft Development Concept "Azerbaijan - 2020: The Vision of The Future", a state program will be adopted to protect labor and monitor the situation in the labor market of Azerbaijan. Measures will be taken to create a safe and healthy working environment for citizens. A national labor and employment information system will be created, a system put in place to track and analyze the labor market and measures taken to prevent illegal employment, the draft concept says.

The endeavors in this area include further improvement of the social security system and expansion of the types and network of state bodies providing social services. The number of social housing properties will be increased and access of the population to such apartments ensured. Social benefits will be unified and measures taken to increase them. The system of providing benefits to families with children will be improved.

In order to create a modern social security system and reduce poverty, the procedure for identifying the needs of families for social aid will be improved and living standards continuously raised.

Azerbaijan joined the World Bank in 1992. WB operations in Azerbaijan have had mixed results and have served as learning points for present and future projects. For instance, good results were achieved in expanding access to credit, and progress was made in improving the business environment, particularly on business registration. However, much work remains to be done in other areas, especially with respect to permits and inspections, which hinder private economic activity, according to the WB website.

The WB said it is modifying its approach in many ways. Broadly, two pillars of the bank's strategy in Azerbaijan are: strengthening the non-oil economy and improving the effectiveness of social and community services.