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Investing in Kosovo
9Labour market

Kosovo is blessed with young, skilled, multilingual and motivated labour force with a strong entrepreneurial spirit and a widespread knowledge of main European languages.

With 70 percent of the population being under the age of 35, Kosovo is considered to have the youngest population in Europe. Due to the multi-ethnicity of the Kosovar society this young population has a high literacy of foreign languages. Albanian and Serbian are both official languages.

Fig.18-20

In addition, Kosovo has a very large international community in its territory and as a result English has de-facto been established as a third official language. Kosovars speaking German and other European languages are due to the large Kosovar Diaspora also numerous in Kosovo.

Taking into consideration the high availability of the work force and the liberal labour law that governs the local labour market, hiring employees in Kosovo is both time saving and simple. According to the Business Condition Index of the World Bank Kosovo can outperform many highly developed countries when it comes to the simplicity of hiring new employees. The same applies to the cost of making redundant which, corresponding to a salary of 20 weeks is far below the regional average.

Furthermore, the highly flexible labour market offers a sufficient work force with varied skills and levels of education and training. Although according to the data covering jobseeker statistics the majority of the labour market supply consists of basic skilled labour, there are sufficient quantities of highly educated jobseekers as well.

The main advantage of the Kosovo labour force remains its low cost. With the average monthly wage estimated at EUR 250 it is the most competitive in the region.

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Comparison of the labour cost in the region is shown in the table 5 (right). Furthermore, the income taxes in Kosovo being only 5 percent of the average gross salary are very low, and the wages are unburdened by costly social contributions, unlike the salaries in most neighbouring countries. The only mandatory contributions are those for individual pension savings accounts, financed by the employer (5 per cent) and the employee (5 percent) contributions on total gross wages paid.

There are two main regulations governing employment issues in Kosovo, the Labour Law Provisions (Regulation No. 2001/27) and the General Collective Agreement. The labour-related legal framework has been built from scratch in recent years and as a result, specific regulations are far more compatible to those found in the European Union than in any other regional country.

Female employees are entitled to at least 12 weeks paid maternity leave upon the birth of a child. This leave is considered as a working period and is to be paid by the employer at a rate of no less than two-thirds of the employee’s current earnings.

Fig.21-22, Tab.5-6

Sickness
Employees are required to notify the employer within 48 hours of taking sick leave. Where sick leave is taken as a result of a work related accident, or illness, the employee is entitled to his/her normal pay for such period.

Work Permits for foreigners
Beside the minimal working age (18) there are no further restrictions in entering into a contract of employment. Foreigners are only obliged to apply for a temporary tax number at the local tax administration authority.

Tab.7

Types of Employment Contract
The employment types are: full time, part time and work at home. Specific clauses that must be included in the contract can be found in Kosovo’s Labour Law (Regulation No. 2001/27).

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