OVI for February 2024: Will labor demand fall in the first quarter?

March 4, 2024

After a decrease in January, the OVI index rose by 3 percent in February according to seasonally adjusted data, compared to the previous month, which is the largest increase since September last year. On an annual level, however, the index recorded a decrease of -0.3 percent, but the decrease was significantly smaller than the -6.7 percent drop recorded in January. In the last three years, OVI recorded a decrease in value on an annual level only six times, and the drop in February 2024 was the smallest decrease of these six. Although the index rose by 1.8 percent in the last 12 months, compared to the previous 12 months, the seasonally adjusted data for the first two months of 2024 point to a moderate decrease on a quarterly level in the first quarter of this year.

Salesperson, cook, waiter, warehouse worker, and driver are still the most sought-after occupations, same as a year ago, although the number of job advertisements for waiters and cooks dropped in February on an annual level and together contributed to OVI’s decrease by as much as -1.5 percentage points. The largest drop in the number of job advertisements in absolute terms on an annual level in February was recorded for waiters and cooks, while the highest increase was recorded for repair workers and bookkeepers. Compared to February 2023, the share of advertisements seeking secondary level education increased significantly (from 61.5 to 64.6 percent), while the share of advertisements seeking lower levels of education fell from 15.2 to 14.3 percent, and the share of those requiring high levels of education fell from 23.3 to 21.2 percent. As in the previous months, the share of advertisements offering permanent employment rose, from 45.3 to 51.6 percent, while the share of advertisements offering fixed-term employment decreased over the year, from 41.1 to 36.5 percent. With regard to the geographical distribution of jobs, the number of job advertisements decreased only in the northern Adriatic, by as much as -14.6 percent. In that region, the number of job advertisements dropped the most for cooks, salespersons, waiters, hotel/hospitality staff, and tourism employees, which probably indicates a change in the tourism employment structure and a step away from seasonal work toward permanent employment.

 

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 2020). 

The index is to be interpreted in such a way that the values greater than 100 represent growth when compared to 2020, and accordingly, that the values less than 100 represent a decrease with respect to the base year. The index is seasonally adjusted using the X-12-ARIMA method.