Accelerating North Macedonia’s digitalisation of employment and labour data to improve policy making

North Macedonia1

NIRAS recently concluded the EU project “Improving the quality of data and strengthening policy making” in North Macedonia, where a long-term labour market forecasting model was among the successful results

January 20, 2022

The collection and application of data has seen extensive leaps in recent years, not least within policy making. This trend has taken place in North Macedonia too, highlighting the need to ensure quality and compatibility of the data used by different governmental agencies. This was the goal of the recently ended two-year ‘Improving the Quality of Data and Strengthening Policy Making’ project that NIRAS implemented in partnership with Ramboll Denmark A/S.

Designed to strengthen sector policy making and support the implementation of the country’s national employment, education, training and social inclusion strategies, the project contributes to the efforts to reduce the high rate of unemployment and skills mismatch , increase labour market participation ‒ particularly among young people and women ‒ improve access to quality education and training, and establish a modern and flexible social protection system.

Despite its implementation in the midst of the COVID pandemic, the project ran smoothly. NIRAS’s project manager, Borivoj Badrjica, emphasises the benefit of an all-local project team based in Skopje, meaning that no travel was necessary. “Luckily, before COVID hit Europe, we managed to have meetings with the ministries of education, labour and social policies, the State Statistical Office, and the national Employment Service Agency and complete the Inception phase,” he says.


economic sectors were included in the new forecasting model


public and private primary and secondary schools and universities, accredited institutions offering adult education courses, Social Work Centers and Employment Service Agency were involved in training;

More than 20

meetings of different working groups and a large number of individual consultations and meetings were organised within the project

Securing the legal basis for the IT project while building capacity

Data management and quality lay at the heart of the project. The team was comprised of four national experts and a local subcontractor Inteligenta who supported the IT component while two international consultants were brought onboard in the second phase of the project. They had to ensure data gathering, data management, data verification process, and later use of data for forecasting and interoperability between all the ministries and relevant institutions which were the project’s primary beneficiaries.  “Like every project, we started with an analysis of data collection processes – we monitored the situation. We then made sure the new system that was developed would be fully functional because there were multiple information systems being run by the Ministry of Education and Science. In parallel to this, there were also systems used by the Ministry of Labor and Social Policy, and the Employment Service Agency. The idea behind project was thus to integrate data on education into a single database, connect the systems of the three beneficiary institutions by designing and deploying web services and develop two BI systems so that, when they use the data in the decision making processes, we have ensured the data is correct, compatible, consistent and accurate,” says Dejan Zlatkovski, a national expert who worked with the IT component of the project.

The project was designed to provide assistance to the Ministry of Education and Science, The Ministry of Labour and Social Policy, the State Statistical Office and relevant agencies and institutions at national and local levels, in the three project areas:

  • Creation of favorable and coherent legal, policy and procedural framework regulating processing of data in the fields of education, labour market and social policy

  • Development/upgrade of information management systems that enable digital data collection, storage, processing and exchange of relevant data within the respective sector institutions - adaptation of the existing hardware and software infrastructure

  • Capacity building at national and local level, including training on how to use data from the State Statistical Office, validated data from other sources and the integrated database system for data collection, data analysis, labour market forecasting and policy

The HERMAC tool: A long-term labour market forecasting model

During implementation, an employment forecasting model called HERMAC needed to be updated. Together with IT experts who were specialised in the model Ivan Lichner and Marek Radvansky, Dejan worked directly with the Ministry of Labour and the Ministry of Social Policy and the two came to Skopje to present the updated model and to train the governmental officers to use the tool.

“In this project, we had to accurately detect and approach the needs of our beneficiaries, namely the Ministry of Education, the Ministry of Labour and Social Policy, as well as the Employment Service Agency,” Ivan says.

In addition to the experts’ revision of the original HERMAC tool, the team provided tools that:

  • estimate the replacement rate, more specifically how many people will leave the labour market and what it means for the additional demand for new people in the form of graduates, migrants etc.

  • disaggregate the results from the model’s unemployment rate nationally by age group and gender

  • enable officials at the Ministry of Labour to create scenarios of different future developments on the supply side of the labour market

  • identify the sectors that struggle the most with finding qualified candidates and predict whether the given trends will increase or decrease over time.

These tools will provide input for policy makers on how to plan education of needed experts in specific economic sectors. This was not possible before the upgrade, which is mirrored in North Macedonia’s high unemployment rate and huge demand for specific skills – in other words, a skills mismatch. “Our companies are struggling to find certain expertise, our educational system is not designed properly to produce what the economy needs. We believe the project will change this; the educational system will become more flexible to movements in the economy,” says Dejan.

“I believe that the project will inspire institutions to set up new processes, change the way they work, so they become more efficient and produce better reforms. Another added value is that this project will inspire professional development of experts in certain institutions. We advised superiors in the beneficiary institutions to continuously invest in the professional development of their staff. For instance, we provided HERMAC trainings for two employees of Ministry of Labor and Social Policy, so they are capable to support the sustainability of this system. However, in the future, more skills are needed to support the further development of HERMAC, specifically data science skills. In other institutions the IT and operations units will have to be equipped with suitable specialist profiles so they can ensure quality maintenance and effective use of the information systems,” says Dejan.

The team has developed a leaflet on the project which you find here

I really appreciate the opportunity to be part of this well-functioning and capable group of experts. All are competent and in my understanding, Borivoj has done a great job – we have all perfectly understood each other throughout the project. I look very much forward to work with Borivoj and NIRAS and the future, as it has been extraordinary experience.”

Dejan Zlatkovski, IT expert on the project

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