By Tomáš Varšo, Aneta Králová and Robert Neruda, HAVEL & PARTNERS
The Slovak Competition Authority (Protimonopolný úrad SR) has recently published an economic report that might break new ground in its policy. The watchdog conducted a comprehensive analysis that examines the competitive environment of the Slovak labour market. The study builds upon the increased interest from the European Commission and other national antitrust regulators in this field.
The general conclusion of the report is that the degree of concentration of economic activity in the Slovak economy in most sectors is low with sufficient competition. However, taking into account the geographical aspects of individual labour markets and types of occupations, the study shows that less developed regions face high levels of concentration.
The study’s most significant findings concern the mutual connection between labour market concentration and wage levels. The Slovak NCA found a significant negative correlation between labour market concentration and wages, meaning that high levels of local concentration negatively affect wage levels of employees.
Geographic inequality in Slovak labour markets
The geographical dimension of the labour market concentration confirms the harsh truths about Slovakia’s economic geography. Labour markets around larger cities in Slovakia (as Bratislava or Nitra) are characterised by a low concentration of employers and the number of job offers is up to four times higher than the number of unemployed people. Conversely, in the eastern regions of the country, for example around Gelnica and Stropkov, there are more than 20 and 50 times as many jobseekers as vacancies.
This concentration has significant consequences. Employees in less developed regions face a limited number of job opportunities and a generally lower quality job environment. Competition between employers is weak, meaning they are not motivated enough to make interesting offers to jobseekers or their own employees.
Policy recommendations: far beyond traditional competition policy
The study presents far-reaching policy recommendations covering both economic and competition policy. Additionally, it does not only present recommendations on a national level, but also calls for a European-wide guidance.
On the economic policy, the study recommends three solutions:
- First, it recommends prioritising physical infrastructure development (highway network) in underserved regions as Slovakia has long ranked among countries with regional disparities living standards.
- The second recommendation is to prioritise state aid to less developed regions as the direction of business’ investment intentions is closely linked to the geographic concentration of economic activity.
- The third recommendation is to strengthen active labour market policies and human capital by supporting education and acquisition of new skills for job seekers.
For competition policy, the results of the study mainly call for innovative approaches to market definition and merger control. For relevant market definitions, the study emphasises the need for a more proactive approach to addressing dominance and concentration effect in the labour market and points out that there is a lack of guidance on identifying relevant labour markets.
This is a strong recommendation as it specifically shifts from the focus on no-poach and wage fixing agreements and broadens the issue further into other aspects of competition law. As regards the approach to mergers, the study describes the U.S. authorities’ approach concerning new and innovative principles to the analysis of dominance and mergers in the labour market. It points that labour markets often exhibit different features than other markets due to several factors, such as high-switching costs and frictions in job search processes, individual preferences and needs limited by the geographic scope, and consideration of non-wage factors.
Will the study influence enforcement?
This study is the result of the reinstallation of the Chief Economist department by the new NCA’s management two years ago. Such a step is a welcome move at a time when the economic approach to competition law is generally in decline.
The key question remains whether the Slovak NCA’s report will have tangible effects. We see it as an important signal of the future enforcement direction of the Slovak NCA. Outside of competition law, we expect that the report itself is unlikely to trigger new developments, but rather will serve as a supporting tool for argumentation.
The Slovak NCA no longer lists the sectors it is focusing on in its prioritization policy (as you can read here), but its activities still reveal where its focus is. In addition to the report on labour markets, the Slovak NCA also published a comprehensive sector inquiry into the food industry this year (see in English here). Although the report did not identify significant antitrust issues, the Slovak NCA recently conducted inspections at bakeries (see in Slovak here). Following this pattern, the Slovak NCA may focus more closely on labour markets, especially in the eastern regions of Slovakia.
Finally, in 2026, we can expect a second-instance decision from the Slovak NCA regarding the first labour market case in Slovakia. In this case, the Slovak NCA imposed a symbolic fine of EUR 10,000 on an association for a no-poaching provision in its code of ethics dating back to the 1990s. Slovakia is thus becoming a jurisdiction whose antitrust enforcement in the labour markets is worth paying attention to.
Robert Neruda is a partner at HAVEL & PARTNERS and heads the Firm’s team of lawyers and economists specialising in competition law. He is a member of both the Czech and the Slovak bar association.
Tomáš Varšo is a senior associate at HAVEL & PARTNERS and specialises in advising on competition law and economics. He is a member of both the Czech and the Slovak bar association.
Aneta Králová is a junior associate at HAVEL & PARTNERS.
Photo (for this post) by I Made Krisna Udiana on Unsplash
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