The unemployment rate increased after independence, reaching 35 percent in 1999 and totaling 313,900 people out of work (out of a total estimated labor force of 890,000). The situation worsened in the first half of 2000, especially in manufacturing, due to the govern-ment's commitment to privatize or liquidate 12 large loss-making factories. Another cause of job losses was legislation requiring all employers to pay social security and pension contributions on newly hired staff, which forced many insolvent employers to lay off workers and freeze recruitment. The still weak economy does not generate new jobs fast enough to outweigh the loss of old ones.
|Household Consumption in PPP Terms|
|Country||All Food||Clothing and footwear||Fuel and power a||Health care b||Education b||Transport & Communications||Other|
|Data represent percentage of consumption in PPP terms.|
|a Excludes energy used for transport.|
|b Includes government and private expenditures.|
|SOURCE: World Bank. World Development Indicators 2000.|
To counter unemployment, in 2000 the Macedonian parliament allowed the early retirement of state employees, but the Constitutional Court ruled that the law was unconstitutional in discriminating between state and private-sector employees, and treating people differently according to gender. Early retirement was stopped, and those already retired were offered the option of returning to their jobs. Teachers demanded a 20 percent pay raise that was unlikely to be granted because the court ruling upset plans to cut jobs in education. The cash-stripped government also decided to offer public employees a 40-kg (90 lb) food package worth $85 instead of annual holiday pay, but trade unions protested.