It is now firmly established that what happens in the youth labour market depends on what occurs
in the economy as a whole.2 In particular, youth unemployment rates are closely related to aggregate labour
demand and it is often argued that labour market regulations such as labour taxes, minimum wages and employment
protection legislation are likely to disproportionately affect the labour market prospects of young
people. It is therefore essential that any analysis of the youth labour market be prefaced by a discussion of
what is happening at the aggregate level, this section of the paper aims to do that by reviewing the general
economic and employment situation in Bosnia and Herzegovina.