A recent World Bank study on the Europe and Central Asia (ECA) region reveals that Albania has experienced one of the slowest and weakest increases in high-skill job creation from 2002 to 2023. While neighboring countries in Southeast Europe have moved toward more knowledge-based and technology-driven economies, Albania’s employment structure remains dominated by low-skill service jobs and limited professional opportunities.
From Agriculture to Low-Skill Services
According to the data, Albania has undergone a visible shift from manual labor toward low-skill service employment, but without a corresponding increase in high-skill or knowledge-based professions. Over the last two decades, elementary or low-skill jobs have expanded by around 15%, while high-skill positions requiring higher education have grown by only 5%.
This pattern indicates a structural transition from agriculture and traditional industries to services, but not necessarily to more advanced or better-paid service sectors. The biggest decline has occurred in routine manual occupations, such as physical labor in agriculture or light manufacturing, reflecting Albania’s ongoing transition away from traditional labor-intensive work.
Expansion of Low-Productivity Sectors
At the same time, there has been an increase in employment in low-skill service sectors, including trade, cleaning, personal care, and transport. These sectors are typically low in productivity and pay, offering limited potential for upward mobility.
While the number of jobs in these areas has grown, their contribution to economic modernization and productivity gains remains minimal. This suggests that Albania’s labor market transformation has been quantitative rather than qualitative—more jobs exist, but they are not necessarily better jobs.
Limited Growth in Professional and Technical Roles
The World Bank study highlights that jobs requiring advanced education, analytical skills, or managerial responsibilities have barely changed in Albania during the 2002–2023 period. Professions such as managers, engineers, IT specialists, or financial experts make up a smaller share of total employment compared to regional peers like Romania, Poland, Serbia, and Croatia—countries that have successfully expanded their high-skill labor force in recent decades.
Similarly, the category of “technicians” and “routine office workers” has seen only marginal growth of around 5%. This underlines the fact that Albania has yet to reach the stage of labor market modernization that characterizes more advanced economies in the region.
A Stalled Transition Toward a Knowledge-Based Economy
Overall, the analysis shows that Albania’s economy has shifted from agriculture to services, but mainly to low-skill, low-productivity segments. The country remains stuck in a “low-skill trap”, where the demand for educated and specialized professionals remains limited, despite a gradual expansion of higher education.
In contrast, countries like Romania and Poland have seen strong growth in professional and technical occupations, supported by foreign investment, industrial diversification, and digitalization. Turkey, Croatia, North Macedonia, and Serbia have followed mixed models, combining a reduction in manual labor with moderate expansion of qualified professions.
By comparison, Albania, Bosnia, and Bulgaria fall into the group of countries that have experienced a steep decline in manual jobs but have not compensated with growth in high-skill employment. This imbalance has limited their progress in increasing productivity and wages.
Implications for Albania’s Labor Market
The structural shift in Albania’s employment landscape highlights a growing mismatch between education and labor demand. Many young graduates face difficulties finding jobs that match their qualifications, while employers in low-skill sectors often report labor shortages due to migration or demographic decline.
Sectors such as tourism, retail, and transport have absorbed much of the workforce leaving agriculture, but they have not generated sufficient added value to drive sustained wage or productivity growth.
The World Bank report suggests that technological progress and skill upgrading remain slow, leaving Albania’s economy vulnerable to stagnation and external shocks. Without stronger investment in innovation, education, and digital transformation, the country risks falling further behind in regional competitiveness.
The Path Forward: Investing in Skills and Innovation
To move beyond this low-skill equilibrium, Albania needs targeted policies that encourage high-value employment. Key areas include:
• Educational reform that aligns curricula with labor market needs, particularly in STEM, digital skills, and management.
• Support for entrepreneurship and startups in technology, finance, and creative industries.
• Incentives for businesses that create or sustain high-skill jobs.
• Public-private partnerships to promote training and lifelong learning.
• Digital transformation of traditional sectors, such as tourism, agriculture, and logistics.
Only by fostering a skilled and adaptable workforce can Albania close the gap with its neighbors and transition toward a more innovative, knowledge-driven economy.
In summary, the World Bank’s findings underline a key challenge: Albania’s economic transformation over the past two decades has been broad but shallow. To ensure sustainable development and higher living standards, the next stage must focus on quality—creating better, higher-skill jobs that harness education, technology, and innovation.