No one in Montenegro has data on how many carpenters, plumbers, masons, and other craftsmen work legally or "on the sly," but it is known that the value of the gray market is enormous and that millions of euros do not end up in the state budget.
The greatest damage from this type of business is suffered by citizens, especially in construction, auto mechanics, and cosmetics, because there is no guarantee of quality, expertise, realistic prices, and compensation for damages...
By working in the grey zone, craftsmen, including some foreign nationals, also create the problem of unfair competition, i.e. prices for services that legal craftsmen practically cannot offer because they pay taxes and issue invoices. This can ultimately lead to the closure of companies and job losses.
The value of the shadow economy last year amounted to about 20 percent of gross domestic product (GDP), or 1,5 billion euros, but it is not known what share illegal craftsmen make up. GDP for last year was worth 7,64 billion euros.
The state is currently trying to reduce the problems of the craft sector and other professions through laws on inspection and crafts, so that inspectors, upon court order, can enter premises where illegal craft activities are carried out. The law stipulates fines of up to 20.000 euros for illegal work.
The main novelty in this sector is the formation of the Register of Craftsmen by the end of this year, which would register all those who operate legally.
Deficit, expensive, some even frivolous
During the research, "Vijesti" spoke to several citizens who had both good and bad experiences with craftsmen who work "on the black market", but they all pointed out that cooperation with them is faster and easier, that they can do their home repairs in a few hours, and that they have long-term cooperation with some of them.
Their main problem is their prices, which, they claim, have increased significantly since the coronavirus pandemic, and what is particularly controversial is "their lack of seriousness and failure to meet promised deadlines."
"There is no carpenter anywhere, and we waited a month and a half for ours, he was expensive and asked for most of the money in advance, so we gave it to him. He did the job quickly, but then we had to wait another two months for the finishing elements and some drawers. The man took the money, took other jobs, answered the phone occasionally and did not come at the promised time," one of the citizens pointed out.
Others, however, claim that after repairing their cars, roofs, and plumbing, they had to make additional adjustments.
Illegal craftsmen did not want to reveal their identities to "Vijesti", but they confirmed that, as in any profession, there are non-professionals among them. They claim that they started working "on the sly" in order to have an income after they were laid off, that their salaries did not keep up with the volume of work and that private employers did not pay them contributions, that they did not have days off, and that they charge as much for the work as they have to, considering its volume and more expensive materials...
Safety and consumer health at risk
Executive Director of the Chamber of Crafts of Montenegro Boris Marđonović He said that the precise number of illegal craftsmen cannot be determined because they work from private homes, garages and via social networks, so they are beyond the reach of inspections.
He emphasized that an additional problem is foreigners working without permits, who are not controlled by anyone, and who are not registered for cross-border services.
He claims that the advantage of working in the grey economy is quickly fading away in the face of the risk of fines, which under the new Craft Law can be up to 20.000 euros for failure to comply with registration, inability to secure payment of receivables, dealing with corporate clients, access to public procurement, loans and loss of pension benefits.
"We have a degradation of the profession. Today, anyone can call themselves a handyman without testing their skills. This means that unskilled persons are repairing brakes, installing installations or preparing food, directly endangering the safety and health of consumers. Instead of quality, the only criterion is the lowest price, which in the long run is collapsing the entire economic system. The value of the gray market is enormous and is measured in millions of euros that bypass the state budget. However, a bigger problem is the damage suffered by legal companies and citizens. Illegal work creates unfair competition. Companies that pay taxes and contributions cannot 'match' those who work 'in the black' on price. This leads to the closure of legal businesses and job losses. The consequences are migration, social stratification, lack of professional staff and labor, long-term unemployment, an unsustainable economy, dysfunctional economic circulation, illiquidity, budget deficits and many others," he said.
Illegally often the most expensive
Marđonović stressed that the Chamber of Crafts, together with the Tax Administration and the Central Register of Business Entities (CRPS), is working on the Register of Craftsmen and will publish it by the end of this year. He claims that they are processing data for 155 crafts across eight sectors and 200 activities, from construction and interior design (construction, modernization, renovation and rehabilitation), metal and electrical, wood and plastics, clothing, footwear, textiles and leather, food crafts, hotel management, gastronomy and catering, to crafts for health and personal care, chemical crafts, cleaning crafts, media, art, design, graphics, printing, communication and advertising...
Marđonović believes that only after the database is created will they get an accurate picture of the craft industry and the number of active companies, employees, income, legal forms and geographical distribution.
He stated that the grey economy does not offer guarantees for work, so citizens are directly at risk, because they cannot complain when a handyman they hired through Facebook, for example, does a bad job on their roof or electrical installations.
"Every day we witness expensive repairs of poorly executed works, and in the worst cases, fires, facade collapses, food poisoning or deaths on roads or construction sites. That is why we insist on a Register of Master Craftsmen with a passed master exam under the responsibility of the Chamber of Crafts, which would guarantee expertise. As far as price is concerned, illegal services are often the most expensive service. Although they initially seem cheaper, the lack of quality and the frequent need for repairs end up costing citizens much more. Legal craftsmen are forced to lower prices below the level of sustainability in order to survive, which ultimately harms everyone - both the economy and the quality of the service," claims Marđonović.
Asked whether the services of illegal artisans are cheaper, he said that the difference is not great, but that it exists in the justification and profit itself. He pointed out that a cake from a registered pastry chef costs around 30 euros, but that the price is the same for someone who makes it in uncontrolled, possibly unhygienic conditions in a home workshop, so the legal one pays taxes, contributions, workers, sanitary standards and rent, while those who operate illegally keep the entire profit.
He claims that the end user pays the same price and assumes the risk, while at the same time revenues for public services are lower.
What after joining the EU?
Marđonović emphasized that on the gray market, artisan prices vary, and that their services are drastically more expensive on the coast, especially during the summer tourist season, due to high demand and labor shortages.
He says that prices in the north of the country are lower because purchasing power is lower, but workers are mobile and move to the coast and the central region.
They did not do a detailed comparative analysis, but Marđonović states that craftsmen from Serbia, Bosnia and Herzegovina, Albania, Kosovo, North Macedonia - come en masse to Montenegro to work "on the black market", because the prices are stimulating. He added that Croatia is much more successful in fighting this problem, because they have maintained a strong chamber system and strict control of qualifications, and they also strive for this in order to protect the domestic market and consumers.
"The analysis of the preliminary results of the economic report confirms that economic measures to generate demand through the mechanisms of the social market economy are more than necessary. Joining the European Union (EU) brings a great challenge. Our remaining workers will gain access to the European labor market and pursue a better life. Although their qualifications cannot be recognized without achieving the same value and they will not be paid as their colleagues from the EU for the same job, their earnings are still many times higher. This will lead to an even more drastic shortage of workers in Montenegro. We are already waiting for months for a good craftsman," said Marđonović.
He also claims that Montenegro currently does not offer a solution for vocational training, that it does not have the capacity itself, but also that it does not want to transfer public powers to the profession. They state that for this reason the Chamber of Crafts is applying the German model, namely the Cooperation Agreement with the "Koblenz" Chamber, and is introducing internationally recognized master's letters, because this, as he believes, is the only way to create a competitive workforce. Marđonović emphasized that the qualification system must be done without state support, because at this rate, Montenegro will be left without a domestic workforce.
A serious challenge
From the Ministry of Economic Development, headed by Nick Djelosaj, they told "Vijesti" that crafts are one of the sectors in which illegal work is significantly present, while the shadow economy is a serious challenge to fiscal stability, fair competition and labor market development.
They stated that there are no estimates of the share of crafts in the grey economy, that currently craftsmen are recorded through registration applications with municipalities, but that they will be entered into the future Register of Craftsmen. They claim that the new Law on Craftsmen and the establishment of an electronic database will provide up-to-date and complete records.
"The Ministry does not have a precise estimate of the number of craftsmen working illegally, because the number of unregistered craftsmen has not been quantified. Estimates of the gray economy are published exclusively at the aggregate level and do not contain separate data for the craft sector. According to the Program for Combating the Informal Economy, the gray economy in the formal sector in 2022 amounted to 20,6 percent of GDP. The latest research from 2025, conducted in the municipalities of Podgorica, Budva and Bijelo Polje, shows that in 2024 the level of the gray economy did not increase, while survey data indicate an estimated share of around 20 - 21 percent in registered companies in the central and coastal regions," the Ministry announced.
They point out that citizens are exposed to risks when using the services of unregistered craftsmen, because there is no guarantee of quality, expertise, and legal protection, so without invoices, contracts, and clear obligations, it is difficult to obtain a complaint or compensation for damage.
They claim that jobs in construction and installations, auto mechanics, and cosmetics are particularly risky, because a lack of standards can lead to serious problems and additional repair costs.
Crafts undervalued
The Ministry stated that the best way to protect against poor service is for citizens to employ registered craftsmen, with verified references and who issue invoices, in order to increase the safety of services and reduce the gray economy.
When asked about the deficit of craftsmen and whether the problem will increase when Montenegro joins the EU, they claim that crafts were not sufficiently valued, that young people rarely chose these jobs, while the qualified ones went abroad.
"The mismatch between education and market needs and the lack of generational change have further influenced the decline in the number of craftsmen. EU accession can increase labor mobility, but also bring opportunities for training, access to funds and attracting experts from abroad. Therefore, it is important to continue strengthening vocational education and programs that make crafts more attractive to young people. The Ministry, in cooperation with other institutions, is working to improve the conditions for engaging in craft activities - through harmonizing education with market needs, promoting crafts, financial incentives and strengthening standards and formalization," the Ministry emphasized.
They say they are working on amendments to the Law on Inspection Supervision, so that inspections, with a court order, could enter premises where unregistered businesses are being conducted - in order to suppress work in apartments and protect consumers.
They claim that they are implementing several activities to improve crafts and reduce the shadow economy, that amendments to the Crafts Law came into force at the beginning of August, which strengthened the normative framework and ensured compliance with the EU, and that these measures also provide for an electronic Register.
They state that they have also adopted a new decision on defining crafts, a regulation on maintaining the Register of Craftsmen, and that they are improving the institutional structure, while offering this sector financial support for the purchase of equipment, tools, and raw materials, and that these amounts go up to 100 percent of justified costs.
They emphasize that they also have programs for youth, women in business, and less developed municipalities, to transition from the gray to the formal economy, and that they continue to implement measures with the Government to strengthen entrepreneurship, the legislative framework, and encourage the formalization of work, so that the craft sector is sustainable.
Deficit number of occupations
The shortage of craftsmen has not bypassed the construction company "Čelebić", which told "Vijesti" that they have been struggling with this problem for several years. They state that the situation is similar in the region, in the fields of construction, tourism, hospitality, agriculture, healthcare, education...
“Construction companies in Montenegro are facing a continuous shortage of qualified and unqualified labor. One of the ways we have managed to overcome this situation so far is by hiring subcontractors for certain phases who have foreign labor, mainly from the region, Albania and Turkey. The professions in particular short supply are reinforcement workers, carpenters, plumbers, joiners, locksmiths, foremen, construction site managers and engineers. It is expected that Montenegro will also face a personnel outflow upon entering the EU, just as was the case with neighboring countries during the period of EU accession.”
They state that motivating and retaining staff in Montenegro requires a systematic approach, but that recruiting workers from other countries is inevitable, so the countries from which workers will come should be carefully chosen, due to expertise, experience, and safety.
Refund for purchased equipment
In May this year, the government adopted the Program for the Development and Promotion of Crafts, worth 300.000 euros, with 100.000 euros more allocated for the sector than the year before.
Through the Program, the state can refund money to craftsmen who purchased certain equipment, with 220.000 euros allocated to those who purchased equipment and were registered by the end of last year, 60.000 for those registered during this year, as well as 20.000 euros for the purchase of raw materials for craftsmen, entrepreneurs and micro-enterprises.
"Approved support for the value of purchased equipment or tools covers up to 70 percent of justified costs in the amount of up to 14.000 euros excluding VAT, up to 6.000,00 excluding VAT per newly registered craftsman, and approved support for the value of purchased raw materials up to 1.000 euros excluding VAT," the program states.
23 craftsmen participated in the Program each year, with 200.000 euros available to them last year, 156.880 in 2023, and 145.317 in 2022.
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