World Bank: Job Creation Crucial for Productivity and Growth in Europe and Central Asia
Economic growth in Europe and Central Asia (ECA) has slowed but remains resilient amid global and regional challenges, according to the World Bank’s Europe and Central Asia Economic Update: Jobs and Prosperity. The region’s GDP is projected to expand by 2.4% in 2025, down from 3.7% in 2024, mainly due to weaker growth in Russia. Excluding Russia, regional growth is expected to hold steady at around 3.3% this year and next.
World Bank Vice President for ECA Antonella Bassani said that developing economies in the region must pursue bold reforms to translate resilience into sustainable gains in productivity, output, and employment. She highlighted the importance of strengthening the private sector, improving education, and boosting international and regional connectivity.
The report underscores that investments in infrastructure, a better business climate, and mobilization of private capital are essential for creating high-quality jobs and fostering long-term prosperity. It also calls for greater inclusion of women and youth in the labor force, noting they remain underrepresented despite recent employment gains.
While employment in the region has grown by 12% over the past 15 years, most new positions are low-skilled with limited income potential. Structural constraints—such as small, slow-growing firms, weak financial systems, underperforming education, and the dominance of state-owned enterprises—continue to hinder productivity.
Demographic trends pose additional challenges: the working-age population is expected to decline by 17 million in the coming decades, particularly in Eastern and Central Europe, while Central Asia and Türkiye are projected to experience population growth, creating distinct labor market pressures.
Photo credit: www.worldbulletin.net.
