Montenegro’s labour market recorded stronger employment and lower unemployment in the first five months of 2026, with average employment reaching about 276,500, up roughly 5% year on year. Registered unemployment declined to 7.84% in May, when approximately 24,751 people were recorded as unemployed. At the same time, average net wages stood at around €1,028 in January-May, increasing to approximately €1,036 in June.
The simultaneous rise in employment and earnings has supported household purchasing power, contributing to resilient retail spending and continued growth in household borrowing. The improvement in labour-market conditions is also affecting the availability of workers across the economy. Montenegro’s domestic workforce remains relatively small compared with the labour requirements generated by the summer tourism season and ongoing construction activity.
Hotels, restaurants and construction companies already make substantial use of foreign workers during periods of peak demand. With unemployment below 8%, the pool of domestic workers immediately available to take new jobs has become smaller. This is increasing competition among employers for labour, particularly as several labour-intensive sectors expand concurrently. Tourism continues to operate at high volumes, while construction activity is increasing. Motorway and railway projects are moving into implementation, alongside continued strength in retail and services. These activities compete for overlapping groups of workers.
The tighter labour market is also reflected in wage pressures. Higher earnings support household living standards, but they can contribute to service-sector inflation when productivity does not rise at a comparable pace.
July inflation figures showed significant price movements in restaurants and accommodation, sectors in which labour represents a substantial share of operating costs. Montenegro’s unemployment rate has therefore fallen to levels considerably lower than those recorded a decade ago, while the economy’s labour requirements continue to expand. Future growth increasingly depends on productivity, migration and labour-force participation, alongside the reduced pool of workers remaining outside employment.
