CROSS-COUNTRY ANALYSIS OF ADMINISTRATIVE BARRIERS FOR SMES IN HIRING PROCESS

Small and medium-sized enterprises (SMEs) have a crucial role in the European economy, but simultaneously face much larger administrative difficulties in their business compared to large ones. Current rigidities in the labour market have further slowed down their position in creating new jobs. Accordingly, the main aim of this paper is to assess the current state of administrative barriers to employment for SMEs in Croatia and Slovenia. The empirical results on a sample of about 700 SMEs for both countries reveal some differences between them. As regards administrative barriers to employment for SMEs, the most pronounced problem in Croatia is related to frequent changes in the regulation, while in Slovenia the most emphasized problem is related to extra time and excessive number of documents. Moreover, a comparison between Croatia and Slovenia reveals some differences regarding the perception of administrative barriers to employment. The findings are important especially for economic policy makers, who need to consider the specific characteristics and needs of SMEs when preparing legislation.