Moldova has experienced rapid growth andincreases in living standards in the past decade. Theeconomy has grown by an average 5 percent a year in the past15 years, while the national poverty rate declined from 26percent in 2007 to 11 percent in 2014; there are sharpdeclines observed in the early 2000s as well.However,Moldova’s growth model has relied on remittances, withlimited job creation. The World Bank (2016) report Moldova:Paths to Sustained Prosperity finds that Moldova’s growthmodel triggered a cycle in which men and women migrated insearch of better economic opportunities and sent remittanceshome that continued to support consumption-driven growth,and that this contributed to poverty reduction and welfareimprovement among the less well off, particularly those inrural areas. The 10 facts presented in the note are asfollows: fact one: job losses are increasing overall, withproductivity-driven economic growth since the 2000sbenefitting a smaller number of people who were able to findjobs; fact two: workers left agriculture and industry forservices, but the 2009 global crisis dampened the jobprospects in services; fact three: out-migration means thatMoldova failed to fully capture a demographic dividend forthe economy, and is now an aging country; fact four:employment and wage patterns show that job outcomes arebecoming less inclusive; fact five: despite their risingeducational attainments, young people face significantchallenges finding non-farm jobs; fact six: as inequality inearnings widens, post-secondary education still earns more,but is becoming less of a guarantee of a better job; factseven: efficient firms are raising their productivity byshedding jobs, not creating them, while firm entry andsurvival rates are low; fact eight: the most productivefirms (small, young, foreign, and private) firms have themost productive jobs, but they are not increasing theirshare in employment; fact nine: while productivity isincreasing, a growing share of jobs is in less-productivefirms; fact ten: firms providing employment are typicallylarger and older, while younger firms are struggling, andfewer new firms have been launched since the crisis. It iskey to continue monitoring these trends over time and, afterthe release of the 2014 census data, the labor market anddemographic challenges that the country faces will need tobe revisited to reflect a more current picture of thesituation and the prospects.
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