OVI for April 2023: Labor market sends positive signals at the start of the second quarter

May 2, 2023

After a two-digit growth rate of the index in January and March this year, in April 2023 OVI index recorded a somewhat modest growth of 5.8 percent compared to April 2022, which still points to continued growth of labor demand on an annual level. Seasonally adjusted index values are also positive and indicate that the number of advertisements in April is 1.6 percent higher compared to the previous month. Since the labor market follows the economic cycle with a time delay, labor market signals indicate that we can expect a positive growth rate of real GDP in the first quarter.

The biggest increase in the number of advertisements on an annual level has been recorded for the occupations of teachers, medical doctors/dentists and construction workers, while the biggest drop has been observed for professors, programmers and workers in the tourism sector. The five most sought-after occupations have remained the same compared to April 2022. Salesperson has remained the most sought-after occupation, followed by waiter and cook, with warehouse worker and driver following next. The biggest positive contribution to the annual growth rate was made by advertisements for salespersons, warehouse workers and construction workers, while advertisements for cooks, waiters and programmers made the biggest negative contribution.
 
Compared to April 2022, the share of advertisements requiring higher level of education than secondary level rose significantly (from 17.5 to 19.5 percent), while the share of advertisements requiring high-school diploma dropped mildly from 63.8 to 63.3 percent. At the same time, the share of advertisements offering permanent employment increased significantly from 40.6 to 45.2 percent, at the expense of fixed-term employment contracts, the share of which dropped to 43.5 percent, but also at the expense of seasonal employment advertisements, the share of which dropped from 14.1 percent to 11 percent. When looking at the geographical distribution of jobs, the highest number of advertisements concerned central Croatia (53 percent), which also had, in April, the highest positive contribution to the overall growth of the number of job advertisements on an annual level amounting to as many as 3.6 percentage points. In all four regions, the following occupations were among the five most sought-after occupations: salesperson, cook, waiter, driver, hotel/hospitality staff and warehouse worker. However, in central Croatia, bookkeeper was among the most sought-after occupations, while brick layers and construction workers were in demand in eastern Croatia.

 

What is OVI?

Online Vacancy Index (OVI) is a monthly index of online job advertisements developed by the Institute of Economics, Zagreb in cooperation with the web portal MojPosao. The index aims to provide timely information regarding current labor demands. OVI index is developed by means of simple enumeration of single new job advertisements whose application deadlines end within the same month for which the index is being calculated. Given that advertisements published by only one web portal are taken into account, the number of job advertisements is expressed as an index (with the base year being 2015). 

The index is to be interpreted in such a way that the values greater than 100 represent growth when compared to 2015, and accordingly, that the values less than 100 represent a decrease with respect to the base year. Index is seasonally adjusted using the X-12-ARIMA method.