Institute Publications


How migration, human capital and the labour market interact in Montenegro


  • Montenegro faces both internal and external migration flows. Internal migration is primarily from the northern region towards the central and southern parts of the country (and from rural to urban areas), causing depopulation of municipalities in the north. There are no comprehensive official records of outward migration in Montenegro. Therefore, the information is based on data provided by Eurostat (on migration in European Union (EU) host countries) and reports on migration trends for the entire South Eastern European region (namely the Western Balkans). The emigration of Montenegrin citizens is mainly to EU countries. Germany, Italy and Luxembourg were the most desirable destinations in 2010. By the end of the decade, Croatia and Slovenia had issued the most residence permits to Montenegrin citizens, apart from Germany.

  • Residence permits for Montenegrin citizens in EU countries were primarily issued for remunerated activities (Eurostat), particularly in the service sector. However, Montenegro is highly in need of service workers, and imports part of the workforce from its neighbours in the Western Balkan region. This imbalance is a consequence of wage gaps between Montenegro and EU countries. Differences in wages encourage Montenegrin emigrants not just to move seasonally, but also to seek permanent residence in destination countries.

  • The high immigration of foreigners into the Montenegrin service sector due to labour shortages represents a major migration concern in the country. This has been noted at governance level. In response, the public employment service (PES) has tried to implement several active labour market and retraining programmes to replace immigrant workers with unemployed and inactive citizens within the country. Such measures should reduce unemployment and inactivity rates, which are among the highest in the region. However, this plan has not been very effective due to low uptake by employers, especially those hiring foreign workers.

  • Brain drain concerns are only relevant for specific occupations such as medical doctors.
    In general, emigration has been skewed towards people with low and medium levels of education. Although official data are lacking, information from the Medical Chamber of Montenegro and the Montenegrin Trade Union of Physicians indicates that around 7% of all doctors emigrated in the past five years. The main reason is better earning opportunities in the healthcare sector abroad. The numbers of emigrants are increasing despite recent wage increases in the sector. Wages still remain much lower than those in destination countries.

  • The main push factors for emigration are wage gaps, lack of jobs, skills mismatch and high youth unemployment, that is, overall poor performance of the labour market and the education and training system. Politicisation of society and weak governance are other triggers for migratory movements. Studies such as this are needed to help policymakers target key issues and implement progressive reforms, since the numbers of emigrants has been growing rapidly in recent years. Pull factors include decent jobs, and higher wages and standards of living in the destination country.

  • The Covid-19 crisis has reduced the international mobility of Montenegrin students. Consequently, enrolment at national universities registered significant increases in 2020. The crisis has not yet affected those who are legally resident in some EU countries due to the various protection measures they enjoy. Moreover, the crisis has not stopped emigration of the highly educated (especially medical doctors).

  • The current pandemic has significantly affected the labour market and labour immigration into the country. Restrictions implemented to stop the spread of the virus resulted in a decline of economic activities. Tourism, which is very important for the country’s economy, was the sector most affected by these measures.

  • The Strategy for Integrated Migration Management in Montenegro 2017–2020 was the main policy document on migration. The main objectives of this strategy were to align policies with EU legislation, further strengthen the institutional framework and establish a monitoring system for implementing the strategy and action plans. This document includes the Law on Foreigners and the Law on International and Temporary Protection of Foreigners. The 2019 report on the action plan recognised the need to improve coordination, communication and exchange of information between all competent authorities to combat the grey economy in the labour market. The continuation of this legislation is the Strategy on Migration and Reintegration of Returnees in Montenegro 2021–2025 (an aggregate of the Strategy for Integrated Migration Management in Montenegro 2017–2020 and the Strategy for Reintegration of Persons Returned on the Basis of Readmission Agreements 2016–2020).

  • The main policy framework for immigration to Montenegro is based on the Law on Foreigners adopted in 2008 and last updated in 2018. This law regulates processes for foreign workers to obtain work and residence permits in Montenegro. It does not favour any occupation or education profile of foreign workers (medium- or high-skilled workers). Instead, it establishes annual quotas for specific economic sectors (not professions). The main goal is to protect the domestic labour force and ensure that Montenegrins have the first chance at available jobs. Recent changes to this law try to balance immigration flows with sector needs. At the same time, procedures and restrictions are eased to attract the foreign labour force. The reforms do not overlook the domestic workforce, but rather focus on protecting it by creating certain criteria for annual quotas on the planned import of labour.

  • The labour market needs serious reforms. Reforms should focus on job creation, the type of contracts, remuneration, job quality and the possibility of professional training and development of workers. These factors are important in the tourism sector as it employs the largest number of people and is the main contributor to the country’s economy. The nature of employment in thissector – characterised by seasonality, low wages, unpaid overtime and even irregular employment – should change. This would encourage low- and medium-skilled workers to stay in the country. Currently, they represent the largest group in the net emigration.

  • Policies on acquiring human capital and skills should be strengthened, particularly outside the formal education system. The education system should focus on tailoring skills to match current and projected demand on the labour market, especially skills where fast gains could be made. In line with the recently adopted Smart Specialisation Strategy of Montenegro 2019–2024, new and continuing vocational education and training (VET) programmes (retraining opportunities for adult workers) are necessary particularly in three priority sectors: sustainable agriculture and the food value chain, energy and sustainable environment, and health tourism.

  • The northern region needs investments to increase job creation and support the economic recovery of municipalities that have experienced intensive depopulation. The priority in fighting this negative trend would be to create favourable policies for businesses, investments in infrastructure and incentives for sustainable economic activities that are aligned with the region’sresources. Some initiatives have been taken but further efforts are recommended.

  • Montenegro needs a comprehensive policy on economic migration and a cross-institutional approach to handling it. To achieve this, a body should be designated to coordinate government institutions that are relevant for migration and non-governmental economic organisations, like chambers of commerce, employers’ organisations, trade unions and think tanks.

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