High and persistent unemployment during the transition to a market economy has been a major economic and social problem for the Slovak Republic. At 19 per cent, the unemployment rate is currently among the highest in the OECD area, while the employment to population ratio is one of the lowest (Figure 17). The under-utilisation of labour lowers the country's growth potential and long unemployment spells are eroding human capital. Given the slow pace of job creation and the low probability of finding jobs, many working-age persons have left the labour force and rely on the extensive social safety net. The absence of a time limit on the duration of income support tends to perpetuate the problem...