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Output per working hour in Albania 35% lower than the regional average

Politiko 2025-06-30 09:54:35

Output per working hour in Albania 35% lower than the regional average

The economies of the Western Balkans continue to face low levels of labor productivity compared to the European Union average, but the productivity of Albanian workers is also the lowest in the Region.

A comparative analysis by the Organization for Economic Co-operation and Development (OECD) published these days showed that the average output per hour worked in Albania was 18 USD for the period 2020-2023, the lowest result among the six Western Balkan economies (WB6).

From the period 2014-2016 to 2020-2023, labor productivity marked slow progress with only USD per hour worked, with a much slower pace than its neighbors. While the gap with the EU is very large as output per hour worked is 68 USD.

The highest value of output per working hour in the Region is in Montenegro with 33 USD from 27 during 2014-2016. In second place is North Macedonia with 31 USD, followed by Kosovo with 27 USD, Serbia with 25 USD output per working hour, Bosnia with 23 USD per hour and Albania with only 18 USD.

The average output per working hour in the Region is 27 USD, while Albania produces about 35% less per working hour than the regional level and about 1/4 of the EU average productivity.

The low labor productivity in our country is a consequence of the structure of our economy, dominated by agriculture and trade with low added value. Given that our economy is highly industrialized, investments in machinery, automation and ICT per capita are the lowest in the region.

Labor productivity in Albania remains the main obstacle to wage growth and economic convergence. Without structural reforms that foster innovation, technology and human capital, the gap with the region and the EU could further widen, international experts analyze. For Albanian business and policymakers, boosting productivity is no longer an option, but a necessity for long-term competitiveness.

The OECD suggests that our country should invest much more in quality education, vocational training, and creating conditions for young people and professionals to stay in the country so that the economy has the human capital to produce more value.

Informality and emigration have acted as obstacles to the productivity of the Albanian private sector. High informality is attributed in large part to low productivity, as informal businesses operate with weak capacities. Meanwhile, massive emigration has reduced the labor force, especially reducing its most qualified layer./Monitor

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