Kazakhstan Manages to Keep Low Unemployment Rate

Apr 17. MFA

Kazakhstan Manages to Keep Low Unemployment RateIn his state-of-the-nation address in January 2012, President Nursultan Nazarbayev instructed the government to develop a new effective programme of employment aimed at increasing people’s incomes. Meanwhile, various employment programmes, albeit under different names, have been active in the country for many years, producing positive results.

According to the Statistics Agency, in 2011 the unemployment rate in Kazakhstan equaled 5.4 percent of the economically active population translating into about 473,000 people without a permanent job. The unemployment rate throughout the country is low compared not only with developing, but also with developed countries.

The highest unemployment rate in Kazakhstan was registered in 1998, when more than 13 percent of the working-age population lost their jobs due to the domestic economic crisis. The second wave of low unemployment was provoked by the recent global financial crisis, during which the unemployed constituted more than 8 percent of the economically active population. To date, the labour market has recovered and the country came close to the indicators of 1993, which showed  6 percent of unemployment.

Statistics on the labour market were not spoiled even by the unexpected global financial crisis. Mass layoffs of 2009 that led to a peaking unemployment were stopped by the beginning of 2011.

The government’s efforts to improve employment programmes made these achievements possible, enabling the country to keep practically the lowest unemployment rate in the Commonwealth of Independent States.

Kazakhstan plans to launch the new employment programme this year. For its pilot implementation the state allocated more than KZT 40 billion in 2011, which covered more than 100,000 people.

This year the government plans to spend KZT 62.3 billion on this programme, covering about 126,000 people. Over time, the annual budget for the programme will grow to KZT 100 billion.

The implementation of the programme will help reduce poverty rate from 8.2 to 6 percent, whereas the unemployment rate will not exceed 5.5 percent, according to the Minister of Labour and Social Protection Gulshara Abdykalikova. In addition, achieving these indicators will have a positive impact on improving the welfare of citizens and ensuring the effective implementation of strategic objectives.

The essence of the new programme is to raise people’s income through facilitating sustainable and productive employment rate. It is aimed at the unemployed and disadvantaged, but in contrast to previous employment programmes, places a great emphasis on the self-employed.

The self-employed constitute over a third of the employed population in Kazakhstan, of which 71.2 percent  live in  rural areas. The level of education is also uneven. Among the self-employed in urban areas, about 27 percent have higher education, one third have specialised secondary education, and less than a half have only finished secondary school. The rural areas  show 8.5, 15 and more than 76 percent respectively. That is why the programme includes special plans for villages. The issue of creating conditions to transfer the self-employed into the legal market environment is also among the priorities of the new programme.

According to the International Labour Organisation, currently the world is experiencing the highest unemployment rate in history of 210 million people which is 30 million more than  before the crisis. The developed economies of the European Union (34 states) accounted for more than half of the unemployment rate in 2007-2010, although only 15 percent of the world’s labour force is concentrated there. In 2009-2010, employment grew only in eight EU countries.

In 2011, Australia showed the lowest unemployment rate among developed countries equaling 4.3 percent. In Russia, the figure amounted to 6.1 percent, whereas Germany and the UK showed 6.5 and 7.8 percent respectively. The highest unemployment rate was recorded in Spain – 21.3 percent. The United States registered the unemployment rate of 16 percent.