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EACEA National Policies Platform
Bosnia and Herzegovina

Bosnia and Herzegovina

3. Employment & Entrepreneurship

3.11 Current debates and reforms

Last update: 7 March 2024

One of the most important features of BiH is its administrative and political structure and complex decision-making system to pass laws and adopt necessary reforms. The problem of youth unemployment is considered one of the burning issues affecting an increasing number of young people leaving the country. In BiH, it is difficult to find a job in the profession since the education system is not in line with the needs of the labor market. In addition, speaking about the needs of the business sector and entrepreneurship, young people are not sufficiently stimulated in terms of developing entrepreneurial competencies during their formal education. Stimulation mainly comes from non-formal education, Youth Banks, Incubators and Start-ups opportunities which are largely realized thanks to NGO sector projects.

According to the Joint Socio-Economic Reform for the period 2019-2022, the skills needed to support the growing economy in the future are currently not being created, and not enough attention is paid to entrepreneurship and innovation in the education system. As a result, according to the latest Global Innovation Index, Bosnia and Herzegovina rank only 77th out of 126 countries.

The IT sector can significantly increase competitiveness, innovation, increase potential growth opportunities and offer new growth and fight corruption. Salaries in the IT sector are significantly more common, as well as opportunities for export, without the need for environmental protection. On the other hand, there is a lack of qualified information that can lead to inadequate access to and underdeveloped IT infrastructure. According to the manifesto, in Bosnia and Herzegovina there is a shortage of about 6,000 people in the IT sector, which can significantly increase the economy and reduce unemployment.

Furthermore, it is necessary to initiate the reforms of the education system with the aim of its better connection with the needs of the labour market. Therefore, all relevant levels of government in BiH will approach the revision of enrolment policies in secondary schools and higher education institutions in order to improve their connection with current and future needs of the domestic labour market. In addition, the authorities will amend the relevant laws on education to introduce a new chapter on the employment of full-time students, so that young people can more quickly gain basic work experience complementary to their study programs, and also provide opportunities for employers. Competent authorities, companies and educational institutions will work on providing vocational training and retraining programs of the long-term unemployed. RS will establish the Science and Innovation Fund, and all levels of government will support scientific research that creates innovation for the economy. Finally, FBiH will consider various options for adjusting maternity leave benefits in FBiH. A single minimum level of benefits and protection during maternity leave will be introduced throughout the country.

The final version of the Program of Economic Reforms 2023-2025 has been developed based on contributions provided by relevant institutions according to the proposed Activity Plan. Entity coordinators have submitted contributions for the Program of Economic Reforms (ERP) 2023-2025 to the Directorate for Economic Planning after being adopted by the entity governments. The BiH Program of Economic Reforms 2023-2025 was adopted by the BiH Council of Ministers at the 4th extraordinary (telephone) session held on March 20, 2023. 

Structural Reforms 2023-2025
Updated data on three key obstacles to competitiveness and inclusive growth and related reform measures:

  • Key Obstacle No.1: Insufficient efficiency of the labor market

  • Key Obstacle No.2: Improve the business environment through closer cooperation and coordination at all levels of government

  • Key Obstacle No.3: Public finance management

The development of the Youth Policy for FBiH is still ongoing, and at the state level there is no law addressing youth issues. RS has adopted the Youth Policy 2022-2026, which, among other things, addresses issues related to the employment and education of youth in RS, along with an Action Plan for the specified period.

The debate on reform needs has been currently mostly dealt with by international organizations, domestic NGOs and youth councils at all levels.