Based on an inclusive round of discussions on 12 November 2020
General overview
The concept of the economy of well-being is of rather contemporary nature, and is based on the understanding that economic growth and societal progress is neither mechanical, nor unidirectional. In practice, evidence presented by OECD (2019, p. 20)[1] insinuates that there is a two-way relation between economic growth and well-being. Generally speaking, this is reflected in the fact that good performance along the material and subjective dimensions of well-being tend to go hand-in-hand. Results issued by OECD (2017)[2] point out that no OECD country does well on quality of life without achieving at least a moderate level of performance on material conditions. In essence, we can define the concept of the economy of well-being as an economy that:- expands the opportunities available to people for upward social mobility and for improving their lives along the dimension that matter most to them;
- ensures these opportunities translate into well-being outcomes for all segments of society, including those at the bottom of the distribution;
- reduces inequalities;
- fosters environmental and social sustainability.
Social capital – impact of COVID-19 on employment and labour markets in SEE
| Challenges | Solutions |
| · Economic informality (both in the share of total output and number of people emloyed); · Unemployment rate (aproximately one fifth of young people were not in employment, education or training)[5]; · Gender gap (women make up about 40% of the total employed[6]; 27.5% of business owners are women and hold just 14.2% of the top management positions in companies[7]); · Brain drain (estimation show that approximately 19% of the ‘SEE six’ population lives abroad[8]); · Two-thirds of people with a high education level have no prior experience with teleworking[9]. | · Refocus EU social grants on capacity-building mechanisms for prevention of informal economy; · National or EU grants should focus on strenghtening the social capital via learning, employment mobility and enhancement of opportunities and platforms for the creation of jobs; · Fostering social innovation ecosystems and creativity to prevent braindrain and youth unemployment; · Investing in e-skills and peer-lerning to adjust traditional offline activities to online activities (jobs); · Draft legislation on gender quotas for the private sector (examples of good practices in France and Germany). |
Human capital – impact of COVID-19 on education in SEE
| Challenges | Solutions |
| · Unavailable online learning support platforms (about two thirds of 15-year-olds students do not have effective online learning support);[10] · Lack of digital devices (about two thirds of 15-year-old students are in schools were the number of digital devices for instruction was not sufficient): · Lack of necessary technical and pedagogical skills (about one quarter of 15-year-old students are in schools where teachers did not have the necessary technical and pedagogical skills to integrate digital devices in instruction). | · Establishing e-learning platforms and e-conferences in order to equip teachers and technical staff with the skills for ”new normal”; · Establish regional platform within an EU-funded programme (such as Erasmus+) that would provide digital devices; · Provide trans-vocational peer-to-peer learning activities in the region in order to strenghten digital skills of pedagogical staff. |
Economic capital – impact of COVID-19 on business sector in SEE
| Challenges | Solutions |
| · Cash-flow problems (loss of demand and revenue, which threatens SME’s survival)[11]; · Labour shortages (lower capacities to shift to teleworking and digital work processes in the context of movement restrictions); · Slowdown in services (the role of tourism, retail and transport sector is especially harmed during the COVID-19 crisis); · Agro-food sector (agro-food sectors is the major contributor to gross value added of the region and travel bans and containment measures and social distance is creating constrains to agro-food labour market in the region); · Limited cargo possibilities (the closure of the EU borders to non-EU citizens is posing both logistical and material difficulties for the region); | · Foreign direct investments could be considered as an option to overcome the financial obstacles for countries; · Enabling national/public or EU grants, which should have at least twofold function (focusing on people and economy), could mitigate the negative consequences of lowering economic capital of the societies; · Mindset shift – trying to figure out how to integrate the agro-food sector in order to both strengthen and regionally consolidate it; · Accelerating the mini-Schengen activities in the region (opportunity to overcome certain regional barriers); · Host series of webinars and e-seminars that would rethink service sector and adjust it to the ”new normal” (peer-learning via regional and EU member states good practices). |
Recommendations for the region
- Improving the socio-economic environment via an Economic and Investment Plan for the Western Balkans in a way that it will be more susceptible for people-centred recovery after COVID-19.
- Establish an online teacher-to-teacher platform where teachers from the region could meet, get additional information, assure peer-learning experience in order to strengthen their pedagogical skills for ”new normal”.
- Facilitate a regional project via Erasmus+ programme in order to equip schools with appropriate digital devices.
- Encourage trans-vocational peer-learning experience between pedagogical staff and ICT specialist in order to equip schools with needed digital skills for smoother transition to online e-learning models.
- Encourage and finance the so-called mini-Schengen initiative in order to mitigate the negative consequences of the lack of current regionalisation (agro-food sector, cargo possibilities, etc.).
- Develop national strategies for people-centred recovery of the SEE economies where social and human capital would be in the forefront of the activities in post-COVID-19 era.
- Invest national and EU grants in social innovation ecosystems and creativity to prevent braindrain and youth unemployment in region;
- Give special attention to the socio-economic grants within new plan for the Western Balkans in order to facilitate the capacity-building mechanisms for prevention of informal econom in the region.
- Finance through the New Green deal bottom-up social projects that would strenghten both human and natural capital and socialise people regarding the importance of the environment within the notion of people-centered economy.
- Develop regional platforms for peer-learning, sharing good practices and preparation of regional projects for mitigation of socio-economic consequences of post-COVID-19 period.
- Establish a regional awareness-raising campaign on the negative consequences of the low level of social, human, economic and natural capital in respective societies.
[1] OECD. (2019). The Economy of Well-being: Creating opportunities for people’s well-being and economic growth. SDD Working paper no. 102, available at: http://www.oecd.org/officialdocuments/publicdisplaydocumentpdf/?cote=SDD/DOC(2019)2&docLanguage=En.
[2] OECD. (2017). How’s life? Measuring Well-being. Available at https://www.oecd-ilibrary.org/economics/how-s-life-2017_how_life-2017-en.
[3] UN. (2020). SDGs still offer best option to reduce worst impacts of COVID-19 and to recover better. Available at https://www.un.org/sustainabledevelopment/blog/2020/06/recovery/.
[4] ILO. (2020). The need for social dialogue in addressing the COVID-19 crisis. Policy Brief. Available at https://www.ilo.org/global/about-the-ilo/how-the-ilo-works/departments-and-offices/governance/WCMS_743640/lang–en/index.htm.
[5] Vienna Institute of International Economic Studies. (2020). Western Balkans Labor Market Trends 2020. Available at https://data.wiiw.ac.at/seejobsgateway-q.html.
[6] World Bank. (2019). Western Balkans Labor Market Trends. Available at http://documents.worldbank.org/curated/ en/351461552915471917/pdf/135370-Western-Balkans- Labor-Market-Trends-2019.pdf.
[7] OECD. (2019). SME Policy Index: Western Balkans and Turkey, 2019. Available at https://www.oecd.org/publications/sme-policy-index- western-balkans-and-turkey-2019-g2g9fa9a-en.htm.
[8] OECD. (2019). SME Policy Index: Western Balkans and Turkey, 2019. Available at https://www.oecd.org/publications/sme-policy-index- western-balkans-and-turkey-2019-g2g9fa9a-en.htm.
[9] Eurostat. (2019). Digiral economy and society dataset. Available at https://ec.europa.eu/eurostat/statistics- explained/index.php/Western_Balkan_countries-EU_-_ international_trade_in_goods_statistics.
[10] OECD. (2020). Education responses to COVID-19: Embracing digital learning and online collaboration. Available at https://oecd.dam-broadcast.com/pm_7379_120_120544- 8ksud7oaj2.pdf
[11] OECD. (2020). COVID-19 – SME Policy Responses. Available at https://read.oecd-ilibrary.org/view/?ref=119_119680- di6h3qgi4x&title=COVID-19_SME_Policy_Responses.
