Alketa VANGJELI
Associate Professor, University of Elbasan, Albania.
alketa.vangjeli@uniel.edu.al
Abstract
Youth emigration has become a persistent structural challenge for the Albanian economy, raising concerns about labor availability, productivity, and the sustainability of small and medium-sized enterprises (SMEs). While the macroeconomic consequences of emigration have been widely examined, limited attention has been paid to its firm-level effects, particularly in transition economies. This study investigates the impact of youth emigration on Albanian SMEs, focusing on labor shortages, skills availability, productivity perceptions, innovation capacity, and growth expectations. Using cross-sectional survey data collected from SMEs operating across key economic sectors in Albania, the analysis employs regression techniques to examine the relationship between youth emigration intensity and firm performance indicators, controlling for firm size, age, sector, and location. The results indicate that higher levels of youth emigration are significantly associated with increased labor shortages and reduced access to skilled workers. SMEs exposed to stronger emigration pressures also report lower productivity growth and diminished innovation activity, suggesting that youth outmigration constrains firms’ adaptive capacity. Although some firms attempt to mitigate these effects through wage adjustments or organizational restructuring, such responses appear insufficient to offset the broader human capital depletion. The findings contribute to the literature on migration and firm performance by providing micro-level evidence from a small transition economy and highlighting the asymmetric vulnerability of SMEs to demographic shocks. From a policy perspective, the results underscore the need for integrated youth retention, skills development, and SME support strategies to sustain enterprise competitiveness and long-term economic growth.
Keywords: Labor shortages, Human capital, Firm productivity, Innovation
JEL classification: F22, J24, L26, O15, R23
pp. 135-145