In mid 2001 the number of registered unemployed people in Slovenia fell below 100,000 for the first time since 1992. The continued positive economic growth from previous years contributed to this, even though it did slow down in the second half of the year resulting in a renewed growth in unemployment, especially in the last quarter of 2001. Due to the events of 11 September, GDP growth was lower than originally forecast (the forecast was 4.4% while according to preliminary estimates the actual rate was around 3%).

Nevertheless, work productivity increased (because the average growth of the number of economically active people was lower than the GDP growth). The average number of officially economically active persons was 1.4% higher than in 2000. However, data on job vacancies shows that employers were more cautious when it came to new employment; they only reported the need for 143,149 workers and trainees - 7.6% less than in 2000. In the first half of the year, the internal search for reserves and costs rationalisation was primarily caused by oil price instability while in the autumn it was caused by the economic instability in the wake of terrorist attacks in the USA. The increase in demand for temporary workers also indicates that employment conditions have toughened up to some degree. In 2001 the demand for temporary workers amounted to 72.4% of the total or 1.7 percentage point more than in 2000.

Despite the fall in labour demand the registered unemployment rate dropped slightly (by 0.6 percentage point on average). The average registered unemployment rate for 2001 was 11.6%. For the purposes of comparison with other countries it should be added that ILO unemployment rate for the second quarter of 2001 was 5.9%; in the last quarter of 2001 it increased to 7.1%, which is still slightly below the average EU unemployment rate (around 7.7%).

In 2001, the educational structure of current demand (labour demand) still differed from the educational structure of supply (the unemployed). Of the total reported demand 30.5% was for people with 1st and 2nd education levels (their share of unemployed amounted to 47%), 34.4% of demand was for people who had attained 3rd or 4th education level (26.8% of the unemployed), 18.1% of the demand was for people with the 5th level (21.5% of the unemployed), and for the 6th or 7th levels the demand equalled to 17% of the overall demand (their share among the unemployed equalled 4.6%). Some considerable imbalance therefore continues to exist in the educational structure on the labour market in 2001.

Trends in the employment and work of foreign workers in Slovenia were significantly affected by the new Employment and Work of Aliens Act. Pursuant to changes in the law the number of valid work permits for foreigners in Slovenia dropped. At the end of 2001 there were 33,982 valid permits, i.e. 15.7% less than at the end of 2000. These were mainly foreigners who have lived and worked in Slovenia for years and not new employment as such. The majority of foreign workers were employed, as in previous years, in the construction industry and in agriculture. The main reasons for the employment of foreign workers include structural discrepancy between labour supply and demand and the resulting shortage of workers, and the willingness of foreign workers to work under more demanding work conditions.

At the end of 2001 there were 104,316 registered unemployed people in Slovenia, the lowest since December 1991. In comparison the end of 2000 it had decreased by 0.3%. In the first half of the year the number of unemployed people demonstrated a seasonal decline, increasing in the second part of the year. On average 101,857 people were out of work in 2001 which is 4.5% less than in 2000. In 2001, 87,673 people were made unemployed which is 6.5% more than in 2000. The majority of newly registered unemployed were people whose temporary employment ended (32,088 individuals or 36.6%); there were 21,888 first-time jobseekers (25%), 8,754 permanently redundant workers and people made unemployed by company's bankruptcy (10%), with the remaining 24,943 people registered for other reasons.

In 2001, 87,940 registered unemployed people left the register, which is 4.5% less than in 2000. Of this number, 52,664 found employment and 35,276 people withdrew from the register or were struck off from the register. In comparison with 2000, 12.5% fewer people became employed. The number of people who unregistered or were struck off from the record for reasons not associated with employment was higher in 2001 with regard to 2000 by 10.6% (35,276). The inactive were joined by 15,830 individuals (44.9%) of whom 5,031 joined education and 7,601 people retired. The second largest category of people removed from the register consisted of people who did not report with the ESS regularly (10,038 persons or 28.5%); 5,064 people decided leave the register of their own accord (14.4%), 2,711 people (7.7%) were struck off because they declined employment, were not actively job seeking, refused to join active employment policy programmes or were working illegally, and the remaining 4.5% of people were struck off or unregistered for other reasons.

Besides the reduction in unemployment the ESS also recorded a positive shift in structural unemployment as the share of long-term unemployed (out of work for over one year) fell from 61.4% the year before to 54.7% in 2001; the share of unemployed people over 40 fell from 50.7% to 48.9% while the shares of first-time jobseekers under 26 and unemployed people with 1st or 2nd education level remained more or less the same. Nevertheless, structural unemployment remains unfavourable as it still predominately features the hard-to-employ categories of people. Active employment policy programmes are extremely important here for improving their position on the labour market.

The basic ESS activity is job mediation, which includes informing, job counselling and referral to vacancies. In 2001, 50,228 unemployed people found employment in regular and special forms of employment; 6,298 unemployed people were employed on public works programmes (2,247 programmes in total), and 46,366 unemployed people found employment on announced job vacancies. In 2001 the ESS referred 94,567 people to announced job vacancies. In 2001 the ESS significantly strengthened and intensified systematic cooperation with employers, with the aim of ensuring a rapid response to demand for labour and providing information on possible forms of assistance as part of active employment policy measures. All the larger local offices have specialised consultants working with employers, who coordinate the referrals of unemployed people for vacancies and in this process directly work with companies and organisations.

As in 2000 the ESS provided information and vocational guidance not only for young people but also for adults in need of assistance from a vocational counsellor. Vocational counsellors conducted 13,588 individual sessions with adults and 9,535 with young people. Special consultations were provided for those unemployed people who were suitable for education programmes, and those whose job counsellors concluded that they need assistance in identifying career objectives or in seeking the best solution with the help of employment programmes. In such cases vocational counsellors also participated in the formulation of employment plans, which are normally developed together by the vocational counsellor and the unemployed person.

Because information on occupations, educational and employment opportunities is growing in importance, the ESS provided such information at its VICCs in Ljubljana and in Maribor and, in a slightly reduced volume and in collaboration with local partners also in smaller towns, at five VICC information points in Ribnica, Brežice, Celje, Žalec and Kočevje.

The ESS worked on overcoming the gap between labour supply and demand by running various active employment policy measures which led to improved supply on one hand (education and training programmes) and increased demand (various employment subsidies) on the other. Education and training programmes were newly joined by 24,022 unemployed people, and additional 4,515 unemployed people continued training as part of Programme 5000. The programme of education for unemployed people adopted by the Slovenian government (at the proposal of the Ministry of Labour, Family and Social Affairs and the Ministry of Education, Science and Sport) was particularly important. The primary objective of the programme was to raise the educational level of unemployed persons and to reduce occupational structural discrepancies on the labour market. During the 2000/01 academic year 5,288 unemployed people joined the programme.

One very important measure, aimed at increasing demand by refunding employers' contributions who employed a first-time jobseeker, long-term unemployed person, older unemployed person or a recipient of unemployment benefit or assistance, continued to be carried out in 2001. The measures was also very effective in encouraging small companies with fewer than 50 staff members to employ new staff. The programme contributed to increased employment in the areas where unemployment was higher than average and to accelerate employment of hard-to-employ people, as the refund was higher in such cases.

For over ten years the ESS has been conducting activities relating to the promotion of self-employment. With the help of this measure, which includes provision of information, business training and advice, as well as the subsidising or refunding of contributions to the self-employed, 1,748 unemployed people acted on their business ideas and became self-employed.

As there were even fewer employment opportunities than before for the disabled than for other groups of unemployed people, the number of disabled people without work (particularly of occupational disabled) continued to grow. The ESS is carrying out various active employment policy programmes targeted at this group and aimed at preserving their jobs (subsidising sheltered companies) and increasing their employability (training and education). The educational structure of unemployed disabled people is even worse than that of the unemployed in general: out of 18,684 unemployed disabled people, as many as 60% have only attained the 1st or 2nd education level. In order to ensure the best possible assistance to this group of unemployed people, the ESS is employing occupational therapists and a special medical service, which carried out 3,680 consultations on medical and ergonomic matters in 2001. Training programmes were joined by 1,245 disabled people, of whom 874 found regular employment after training. As spin-offs of company-restructuring processes, new sheltered companies are often created as a way of preserving jobs for disabled people. The number of sheltered companies increased in 2001 again, to 144. At the end of the year they were employing 6,154 disabled people. The ESS pays monthly subsidies to sheltered companies in line with the Rules on the Criteria for Subsidising Part of Costs of Sheltered Companies.

Public works programmes pursue two primary objectives: to encourage the opening-up of new jobs, and to preserve and develop the working habits of unemployed people. A total of 9,374 unemployed people were working on 2,247 public works programmes - similar to the previous year's figure. On average, 5,217 unemployed people were involved in public works. Public works programmes are intended for hard-to-employ categories of unemployed people. Half of the participants were long-term unemployed (in 2001, 45% of all public work participants were long-term unemployed) and almost half (48.8%) were over 40 years of age. What is particularly important and pleasing is that the number of people finding regular employment during a public works programme or within six months of its completion is growing. In 2001 as many as 3,467 participants (37% of all participants) found employment or did not place themselves again on the register of unemployed persons. In previous years, this proportion was between 5-31.8%.

One important new programme that will increase the employability of the most difficult groups of people to employ is the "Thousand New Opportunities" programme which, by subsidising employment for three years, allows older unemployed people, the disabled and other categories of hard-to-employ people to find employment in various non-profit services. The programme was started in 2000. In 2000 and 2001, 290 people found employment with the help of this programme. A similar programme aimed at accelerating employment as homecare providers which was launched in 2001 and enables the regular employment of hard-to-employ people. Based on a public tender 327 such placements were approved and 38 were carried out in 2001, the rest will be carried out in 2002.

In order to accelerate the employment of young professionals in areas where unemployment is above average the ESS and the Ministry of Labour, Family and Social Affairs in 2001 published a public invitation to tender for the refunding of part of the wages of trainees. As a result 102 trainee placements were approved, of which 44 were carried out by the end of the year.

One important programme of assistance for companies dealing with the issue of permanently and potentially redundant workers is the labour funds programme. In 2001 1,170 newly redundant workers (of whom 432 were potentially-redundant workers) were included in the programme. Over 60% found new jobs or were able to preserve their old one by acquiring suitable additional training and education.

In 2001 the promotion of regional and local employment and assistance to companies participating in the government project of staff restructuring in companies (training of key and other staff) programmes were completed.

Active employment policy programmes were attended by a total of 60,914 people in 2001, of whom 52,066 were unemployed. The result of including hard-to-employ people, older and long-term unemployed in active employment policy programmes was a change in structural unemployment at the end of the year, with considerable improvements in the proportion of long-term and older unemployed. Active employment policy programmes helped unemployed people acquire new know-how and skills, especially in public works, which improved their employability. During the programme or immediately after 10,152 people found employment. Subsidies helped 9,144 unemployed people find employment. Other participants already employed in sheltered companies or in companies undergoing a restructuring process (7,866 in total) or were able to preserve their employment through subsidies and by undertaking training.

By the end of 2001 the Supervisory Office commenced 1,268 supervisions to see whether unemployed people and contractual providers (employers and programme providers) were fulfilling their contractual obligations. The number of supervisions over the ESS's contractual partners was three times higher than in 2001 (179 supervision cases). Supervisions were completed in 1,192 cases. One hundred and thirty two people were removed from the register and 15 lost their entitlements arising from unemployment insurance on the basis of discovered irregularities. In 31 cases failure to fulfil contractual obligations resulted in proposals to act against employers.

In line with the Act, the ESS decides on rights arising from unemployment insurance. The 2001 trend in the area of unemployment benefits and unemployment assistance was the same as in 2000. The fall in the number of recipients of unemployment benefit continued and at the end of the 2001 there were 19,489 recipients of unemployment benefit - a fall of 15.6% on 2000. The trend was completely the reverse in the area of unemployment assistance, where the number of recipients grew constantly, from 3,754 to 4,516 by the end of the year. This was the consequence of new conditions for obtaining rights and, in particular, of active job placement and participation in active employment policy programmes (a total of 4,999 people were entitled to unemployment insurance benefits).

National and Zois scholarships can be granted to apprentices, secondary-school and university students who meet the conditions laid down by the Act and the Rules on Scholarships. The number of national scholarships began to increase during the 1990s at the same time as the number of company scholarships was falling. The main objective of national scholarships is to allow young people from disadvantaged backgrounds to study, and of Zois scholarships to encourage the development of highly gifted students. In the 2001/02 academic year, 40,773 secondary-school and university students were entitled to national scholarships and 12,191 to Zois scholarships. In 2001 a new service was developed - the e-exchange of Zois scholarship recipients which is hosted on the ESS website and will increase the possibilities for closer cooperation between Zois scholarship recipients and employers even while still studying.

The ESS continued to rationalise its operations and increase its efficiency. It updated its organisation, introduced quality standards for client services (Koper RO), completed the open system of receiving clients, upgraded the internal monitoring system and activity control system as well as the supervision system that ascertains whether the unemployed and ESS contractual partners meet their obligations.