Mesopartner Summer Academy 2018

It’s been a month now since I had the privilege to attend Mesopartner Summer Academy 2018 (MSA) in Berlin, together with my colleges from Eda and from Ministries related to SMEs in Bosnia and Herzegovina.  It was my second MSA, since I also attended the one organized in 2016 (dedicated to Green Economy).

MSA is a 5-days event in Berlin organized by a group of brilliant lecturers (and practitioners) from Mesopartner, which also means from all over the world. Topics change on yearly basis, but some of main approaches stay every year, like Systemic Competitiveness, Complexity or stress on meso level/supporting organizations in local economic development. Besides cutting edge knowledge and tools for practitioners on economy-related matters, it’s also an example how such an event should be organized and moderated: A lot of knowledge shared, using good moderation and lecturing tools, in a great environment with just right amount of sightseeing and relaxation moments. This year, main topic was Role of the meso organizations in local economic development, and you can read it all in the Annual Reflection 2018. One of my favorite tools this year was Product Space.

MSA is organized in Berlin. It’s, together with Istanbul, the most impressive European city I’ve been to. It was introduced to us as a city of transformation, and in my experience that introduction was on point. It’s striking how interesting and unique, while at the same time relaxing Berlin is – both during the day and during the night. You can  experience it’s unique urban vibe quickly upon arrival. It’s a fantastic mixture of different architectural styles, that enable you to feel it’s rich, hard, sad and glorious history unified in new liberal values that attract foreigners to return to Berlin. Contrary to the general belief that Germans are boring and reserved, I’ve experienced Berliners as humorous and relaxed. I recommend renting a bike as a way to get to know the city.

By the way, did you know that Berlin is soon-to-be biggest EU city, after England brexits the EU?

Part II: Iceberg model and Employment Issues in Bosnia and Herzegovina /Thinking Out Loud/

You can read my first thinking out loud blog on Iceberg model and Employment Issues in Bosnia and Herzegovina here.

As I wrote at the end of that blog, it was supposed to be continued over time, and here are some more insights…

Updated Iceberg model,
right click -> open image in the new tab to see full size image


I will use my old list and just add new things in bold.


  • Poor working conditions in industry: overtime work, irregular salaries, “bossing”, incomplete salaries at the end of the month, poor salaries…
  • Employers report that high school graduates don’t have appropriate knowledge
  • Employers often don’t register their employees (they usually do it later, when state offers incentives for employment)
  • Enterprises can’t find workers
  • Unemployed persons show poor interest for employment programs (note: high school graduates show best interest)
  • Enterprises mostly need low skilled workers
  • Export of B&H industry is growing
  • Diplomas can be bought
  • Low level of foreign investment
  • Salaries in public sector are 2 times higher than in a private sector
  • Children (and their parents) don’t want to go to high schools for industrial professions


  • Workers are leaving B&H, especially young people (large percentage of them is finding jobs abroad with help of Employment Offices)
  • High-income families are also leaving (some of the reasons I found in interviews online are general uncertainty and lack of possibilities for professional advancement)
  • Both unemployed and employed persons are looking for jobs in a public sector 


  • Enterprises must offer their products for low price to be competitive (since without Research&Development and final products, they don’t have many possibilities), so they are making saving by paying low salaries
  • More employees in the public sector bring more votes
  • Partocracy is in power instead of democracy 


  • Ingenuity at the expense of the state
  • “If others are doing it so will I”
  • “It’s better to do nothing for nothing, then to work for nothing”
  • general belief that it’s a shame not to finish a college


To be continued…

Why aren’t there more programmers in Banja Luka

I recently talked to a friend working in IT sector in Banja Luka and I thought I could write a few fresh insights.

Situation in IT sector in Banja Luka Region is similar to other sectors regarding labor – we don’t have enough workers. Just like in other sectors, this is one of the main obstacles for further development of local IT firms. I’m not sure if it’s identified as a main obstacle by now, but if it’s not – it will be.

We were talking about how programmers become programmers. Apparently, in this sector formal education is not needed as much as in other sectors, at least if you are planning to get a job in small or medium enterprise (unlike public sector or big companies or banks, etc). Most people don’t have formal education anyways. Former car mechanics, graduated geographers, people with secondary education, etc. are very often in IT SMEs. Most of them didn’t participate in any kind of courses – they learned all they know by studying .pdf tutorials and watching YouTube, and during practical work. He was joking that best friend of anyone trying to master programming is “how to” combined with Google. When seniors advise newcomers, they usually tell them not to waste money on commercial courses when everything is available online, for free.

I was very curious how long would I need to study these tutorials in order to be able to find a job in Banja Luka. Answer was 3-6 months, depending of how serious I am. I was surprised to hear that after 3 months of serious work, employers would actually consider employing me. Employers, naturally, need seniors, but seems that they are aware that they can’t afford and find them. So employers have lowered their criterion. I have found out that employers generally care about discipline and elementary logic. Programming is something that can be learned.

So, I wondered, why aren’t there more people starting to learn programming? Answer didn’t surprise me: it’s because of biases. People see programming as advanced mathematics, or perhaps nuclear physics – something hard to understand and unreachable. And it’s not. Former car mechanic, now self-taught programmer with minimal knowledge of mathematics, is successfully doing it.

From my experience, this is not the only answer, but for the beginning – it sounds IT-specific enough.


Expensive real estates in Banja Luka are pushing young people to emigrate

Young people are leaving B&H, it’s a fact. There are several economy related reasons. But there are also reasons not directly related to economy. One of them, in my city (Banja Luka), is price of real estates.

For example, in Paris you would need 1,3 average salaries to buy 1 square meter of a real estate, and in Vienna 1,5. In Banja Luka, you would need 2,86 average salaries. I’m not sure why is that so. Answer might be somewhere between investor urbanism and trend of Banja Luka’s diaspora buying large percent of those flats. For diaspora, 1150€ for 1 square meter is affordable (in Paris it’s 6500€ and in Vienna 3000€), but for domestic residents it is not.

I recently got a chance to read Eda’s publication First flat (2010), and in there I have found a scenario calculation for young couple planning to raise a credit for buying flat.

  • flat size: 50 square meters
  • price of square meter (cheaper one): 1050€
  • 2 average net salaries: 780€
  • maximal yearly annuity: 390€
  • interest rate: 7%
  • repayment period: 261 months
  • interest: 50 000€
  • principal and interest: 102 000€

This is not a realistic scenario IMO. It is more likely that young people will continue living with their parents and minimize their costs, delay forming a family, or rent cheap flat and wait for the opportunity to leave the country. Other alternatives I see are involving in criminal activities or leaving the country immediately. In any case, in all of these scenarios their bonds with this city and country are purely emotional, and therefor relatively weak. That means even less workforce in B&H in the future, and what is even more worrying for the society in general is lower birthrate.

I see this as some kind of a failure (market failure?) which needs intervention in order to make buying a flat feasible for young couples (using credit funds seems inevitably). It is not only society in general, represented by the government and local governments, that I believe should be very interested in solving this issue, but also enterprises. If these trends continue in the future, and if nothing changes they will, there almost won’t be any workers left.

There were some attempts to lower price of real estate for specific groups in some municipalities and I will analyze them in the next blog. I will also try to position where could enterprises be in that scheme, in a way that could be acceptable for them.

P.S. While writing this, I started thinking if bonding young people to this country is evil and if I should simply delete this post. I decided not to delete it, but it probably is evil, sorry.

Iceberg model and Employment Issues in Bosnia and Herzegovina /Thinking Out Loud/

I have firstly encountered Iceberg Model somewhere on the Internet during 2017, in one of Leyla Acaroglu’s articles/blogs. It immediately made sense to me and I copied it to my notepad. In short, it’s a tool used to gain a deeper understanding of things. It illustrates that things we see or read about in newspapers (events) are only a tip of iceberg. There’s much more of iceberg under the water, just as there are things that influence things we see or read about, but are not easily visible.

source:  Leyla Acaroglu 

A few days ago I tried to find Leyla’s post, but failed. Instead, I found Systems Thinking With The Iceberg: A Tool for Multi-stakeholder System Sight which explains it nicely.

In order to help myself understand (un)employment in Bosnia and Herzegovina better, I decided to give the iceberg model a try. Here are the first results:

right click -> open image in the new tab to see full size image


  • Poor working conditions in industry: overtime work, irregular salaries, “bossing”, incomplete salaries at the end of the month, poor salaries…
  • Employers report that high school graduates don’t have appropriate knowledge
  • Employers often don’t register their employees (they usually do it later, when state offers incentives for employment)
  • Enterprises can’t find workers
  • Unemployed persons show poor interest for employment programs (note: high school graduates show best interest)
  • Enterprises mostly need low skilled workers


  • Workers are leaving B&H, especially younger people (large percentage of them is finding jobs abroad with help of Employment Offices)
  • High-income families are also leaving (some of the reasons I found in interviews online are general uncertainty and lack of possibilities for professional advancement)


  • Enterprises must offer their products for low price to be competitive (since without Research&Development and final products, they don’t have many possibilities), so they are making saving by paying low salaries


  • Ingenuity at the expense of the state
  • “If others are doing it so will I”
  • “It’s better to do nothing for nothing, then to work for nothing”
  • general belief that it’s a shame not to finish a college

I’m about to add more events in the next few days (or weeks), which I will use to see if there are any new patterns or structures appearing. I’m also sure some things are misplaced, but still I decided to post it. If someone who has used Iceberg model in practice and/or is interested in the same topic is reading, a comment would be great.

To be continued…

Enterprises in Banja Luka Region mostly need workers with low level of knowledge and skills

It is possible to find a news article with lists of unemployed persons sorted by professions. But I don’t remember I ever found similar list of workers required by enterprises, sorted by professions.

I got a chance to make such list for region of Banja Luka on Job Fair in June 2017. I’m aware that not all enterprises which are looking for workers were present on this Job Fair, but I believe that based on those that were present a rough image can be formed on what professions are needed by domestic enterprises.

Enterprises from Banja Luka and neighboring municipalities (Čelinac, Gradiška, Kotor Varoš and Prnjavor) were present and they were in search for almost 800 workers.

It is evident that nearly half of workers are required by textile and shoe wear industry, and that they need workers in production. Requirements for employment in these enterprises are low. Candidates are only required to have elementary school diploma, which means non-qualified workers can apply. Low level of needed skills and knowledge for work in these positions conditioned very low salaries (minimal salary, ~200 EUR). This shouldn’t surprise anyone, since textile and shoe wear industry products are made in the same way in Germany, Turkey, India and here, which means enterprises in this industry need to offer lower price to be competitive. That’s why they need to make savings in production, and the most effective way to make those savings are low salaries for workers. To conclude, enterprises in this industry offer plenty of jobs, but those jobs are, conditionally speaking, not quality ones.

For easier analysis, in further text I will ignore this industry and analyze rest of required workers.

When we ignore workers required by textile and footwear industry, most of required workers are non-qualified workers with only elementary school finished. They are mostly required by construction companies: construction carpenter, armature workers, masons, electrical installers. Then there are Mechanical engineers (first profession with Faculty education) – 19 of them. Out of mechanical professions, mechanical technicians, welders and locksmiths are also needed. Leather technicians, carpenters, sellers, whitesmiths, tip truck drivers are also needed, about 10 for each profession.

I was surprised to see small number of required CNC operators (7), since I often hear in enterprises they’re always in pursuit for them.

It’s interesting to highlight number of needed engineers, total 28. 19 mechanical engineers, 8 electrical engineers and one geoinformatics engineer. Number of needed architects is 5 and number of economists with Bachelor is only 1. In total, number of professions with Faculty diploma is 34.

Then I grouped professions required by domestic enterprises based on level of knowledge and skills they need to have. This is how I did it:

5 – engineer / Faculty diploma
4 – Technician / Highschool diploma
3 – craftsman
2 – trained worker
1 – non-qualified worker

This is the result:

Hence, enterprises in Banja Luka Region are mostly looking for trained workers (whereby terms for employment are usually minimal, so we can also call them non-qualified workers), 478 of them. With 37 non-qualified workers, we get information that 65% of required workers are those with minimal knowledge and skills. With raise of needed knowledge and skills, demand for these professions is decreasing. Thus, number of needed craftsmen is 199, number of needed technicians is 51 and number of needed professions with faculty education is 37.

Now let’s get back to the beginning and remind ourselves that now all enterprises in Banja Luka and Region were present at Job Fair Banja Luka 2017, so these data should be taken with reserve. But I think that at least they are useful to make these conclusions: Required professions in Banja Luka are mostly those with low level of knowledge and skills. That shows us that economy of Banja Luka Region is not complex enough and that products it makes are relatively simple, because demand for knowledge and skills is low.

From the perspective of enterprises, it means they can’t be competitive with quality, but with low price. From workers’ perspective it means that their knowledge and skills are not needed and that what lefts, and that is their physical work on relatively simple jobs, will be low paid.


Banja Luka Region has 35 000 people on Employment Office’s list of unemployed persons. Yet, during my visit to Job Fair, only about 10 unemployed persons were inside the hall. More employers then unemployed persons. But that’s topic for another blog.

Expert’s phrase diary is blurring the image

After few years of participating in and organizing workshops, it seems to me there is a problem with expert’s phrase diary in communication. A number of phrases, words and formulations that are often used to describe something by experts and consultants. There are plenty of those in, for example, strategic plans. The fact that experts have their own vocabulary is fine while they are using it in expert-to-expert communication, the problem appears when non-expert participants in workshops start using it: entrepreneurs, directors, workers, engineers, employees in the local administration, etc. And it seems to me they are using it because they see experts using it and they think that’s how they need to speak and formulate things they are about to say.

I’ve seen many times employees in the local administration being agonized while trying to formulate one simple thought. For example, in one small municipality in Republic of Srpska, result of that process was a goal “Solving a problem of floods on territory of the Municipality”. Seems legit, right? After asking them what that was about, we realized one small river was flooding in a specific location. When I asked why they formulated it that way if only one river was flooding one specific location, they laughed and said it sounds more professional. We re-formulated the goal and asked them not to use professional phrases anymore and just to say what is the problem using their own vocabulary. They did that, and it was much easier and faster from that moment. Later, we carefully reformulated it, so we don’t change the meaning.

Seems to me that, when non-experts are using experts’ vocabulary in workshops or elsewhere, valuable information is lost. Phrases tend to ‘swallow’ details, blur the image and fit statements around universal issues. I don’t think such waste of specific details is good during first phases of doing anything, and I find experts’ vocabulary to be a culprit of many superficial and too-generalized documents we have today.

Fastest growing industries in Bosnia and Herzegovina are food related

I have recently read an interesting blog written by Cesar Hidalgo, Trump, forget about Coal and Nuclear, software exports is where the jobs are at. His point was, among others, that state should invest more in growing sectors to provide new jobs. That instantly made sense to me, so I started thinking about what sectors are fastest growing in Bosnia and Herzegovina.

Since data on export from B&H 2013-2016 were recently released, I figured out I could use that to show approximately which sectors are growing fast. Also, I used export data since export-oriented sectors (and enterprises) are also the most competitive and most advanced ones.

First, let’s see how does B&H export treemap looks like in 2016:

Here are a few of my random thoughts about this treemap. It’s interesting that Furniture is #1 export product of B&H (excluding Cork and Wood manufactures), and wood as raw material #4, especially when you know how hard it is for domestic enterprises to get raw wood for their production.
Footwear and wearing apparel enterprises are good for creating a lot of jobs, but these jobs are not well payed since wages are mostly minimal allowed (200€). Those firms are mostly working for partners in EU, without developing their own products.
Metal processing enterprises are usually making parts for their foreign partners and don’t usually have their own final product. Unlike wood processing sector.
Road vehicles are compiled in Sarajevo for Volkswagen.

Now, let’s see which of these are fastest growing in period 2013-2016:

None of these are in top 5, but most of them do have an export growth. Furniture has export growth of 4,5%, Footwear also 4,5%, Manufactures of metal 6,5%, Cork and Wood 4,97%, Road vehicles 5,4%, Iron and Steel -4,2%…

Top 5 – Export Growth

  1. Animal and vegetable oils and fats (29,50% growth)
  2. Chemical materials and products (28,33%)
  3. Travel goods (23,57%)
  4. Meat and meat preparations (22,39%)
  5. Cereals and cereal preparations (17,68%)

What attracted my attention is that 3 of 5 products from top 5 export growth list were food products. So, it seems to me that food industry is the fastest growing industry in Bosnia and Herzegovina, and industry where B&H could create significant number of jobs.

P.S. I am also wondering where is the position of the IT industry in B&H export and how high is it’s growth.

Review of Labour Force Survey in B&H 2017 – more realistic representation of workforce in RS

These days media in Republic of Srpska are reporting of 263 476 employed persons, which is the highest number in history, referring to data published by Employment Office of RS. At the same time, Agency for Statistics of B&H publishes Labour Force Survey 2017, given the information of 313 000 employed persons in RS.

Where does the difference come from?

Unlike the Employment Office of RS, which defines registered workers (working in enterprises, institutions, as entrepreneurs etc.) as employed persons, Agency for Statistics of B&H used a definition that also included non-registered workers, working in enterprises or as entrepreneurs.

“Employed persons are persons aged 15 years and above and in the referent week they: (a) worked at least one hour for salary or fee, regardless of their formal status, or (b) didn’t work, but had a job they will return to.”

If we search for the number of unemployed persons in Labour Force Survey 2017, which is 116 274 according to Employment Office data, we will see it is 83 000. Therefore, significantly minor. Once again, definition of unemployed persons is different between Employment Office of RS and Agency for Statistics of B&H. Employment Office implies that unemployed persons are persons registered at Employment Office as active job seekers, and Agency for Statistics implies that they are persons who didn’t perform activities for salary, or were seeking for a job. (More about active and passive job seekers you can read in my previous blog.)

“Unemployed persons are persons aged 15 and above who: (a) in referent week didn’t perform any activities for a salary or a fee, (b) during four weeks (referent week and three previous weeks) were actively seeking for a job or found a job and will start working soon, (c) could start working in the next two weeks, if they were offered a job.”


Employment Office of RS (October 2017) Agency for Statistics of B&H (April 2017)
Number of employed persons 236 476 313 000
Number of unemployed persons 116 274 83 000

As in my previous blog, I need to underline that RS, as well as whole B&H, isn’t a place with surplus of workforce anymore, but a place with deficit of workforce. Number of working age population is decreasing at significant speed. Firstly that was recognized by local enterprises, who in the beginning had difficulties to find skilled workforce, and nowdays have more and more problems to find any workers. A drastic example happened recently in Visoko, where enterprise Prevent opened a call for employing 400 people, and they only found 2.

Only during the last 2 years, number of working age population in RS decreased by nearly 50 000. The trend is, unfortunately, speeding up: between 2015 and 2016 number of working age population decreased by 18 000, and between 2016 and 2017 by 29 000.

2015 2016 2017
Working age population in RS 885 000 867 000 838 000

In the meantime…

In the meantime, Council of Ministers of B&H and Government of Republic of Slovenia have an agreement on employing citizens of B&H in Slovenia through 3 employment offices in B&H, which is being more and more exploited.

2013 2014 2015 2016 2017 (until October)
Numbers of B&H citizens employed in Slovenia through employment offices in B&H 661 1870 2677 4478 8123

How much incorrent secondary data are? (In context of employment in RS)

Republic of Srpska (federal unit of Bosnia and Herzegovina) has, based on Employment Office records, 116 274 job seekers as of October 2017. According to these data, unemployment is significant. Someone could say there is not enough jobs in Srpska, since these people can’t find one. Even Employment Office, in such deficit of jobs, published advertisements for employing our people in Slovenia, Slovenian Post Office for example, or various private owned businesses. Apparently, they have deficit of workers, and we have plenty.

Is this so?

When you talk to domestic enterprises and people from these enterprises, you’ll hear they have serious problems finding not only skilled workforce, but more and more any workforce. Also, projects organizing trainings for acquisition of skills for work in industry have problems with low number of unemployed people applying to these trainings.

So, something here isn’t right.

There are many unknown elements in this equation, but now I want to concentrate on one of them, which is of technical nature. Number of listed unemployed persons, or active job seekers, does not corelate to real situation.
Namely, job seekers are divided into two groups: passive and active. Passive job seekers (an oxymoron) are not seeking for a job. They are registered in the Employment Office records because of exercising their constitutional rights on health insurance. Even though they are called “job seekers”, they are not job seekers. Everybody is aware of that and they do not participate in this number of 116 274 job seekers.
Active job seekers should be really seeking for the job. They are, from time to time, contacted by Employment Office for job interviews in enterprises. They do make the number of 116 274 job seekers. Problem with reliability of the job seekers list exists because of the way job seekers are classified in active or passive group – they declare themselves as passive or active. Part of those people, de facto passive job seekers, are declaring themselves as active ones in fear they will be deleted from the list and loose their constitutional right on free health insurance. While talking to employees of Employment Office, you can hear that number of active job seekers varies depending on statements of high-ranking RS Government officials regarding deleting passive job seekers from the list. During the job interviews, these persons say to potential employer that they participate only pro forma.

I’m not sure is it possible to determine approximate number of such cases, but I’m afraid they make too large percentage of the active job seekers. This could, partly, explain wrong perception of Republic of Srpska as area with surplus of unemployed people.

In any case, secondary data should be defined the way that they make easier, instead of they make more difficult proper treatment of the problem they are related to.