This paper analyzes the labor market dynamics in Albania. The analysis is based from the observations of the labor market on a ten year period from 2000 - 2010, surveys, historical data and trends. The main employed people are part of the private sector where the majorities are part of the private agricultural sector, however it has experienced decrease. In ten years the employed people in the public sector, have steadily decreased, whereas the number of employed people in the non-agricultural private sector has increased. However in general the employment level has decreased for males and females but for the latter group a little bit higher, with a change between the two of approximately 3%.
Related to the unemployment level, it has decreased for both males and females. Albania is characterized as a country that has experienced radical changes from a centralized economy toward a democratic one. However this is not accompanied with the necessary changes or reforms in the labor market. In Albania, there is the ministry of labor, social affairs and equal opportunities, but it is important to note that even though they do exist they are a formal, not to say an inexistent medium for finding a job. In general people are directed towards informal ways to find it. So it is important to mention the role of institutions for an efficient allocation of jobs in the labor market.
Data are collected, and through regression analysis we will see the negative relationship that exists between unemployment with FDIs and also education. How the two can decrease in the long term unemployment.