Šarec said that he "cannot fulfil people's expectations at the moment with 13 MPs and this coalition", but stressed he could fulfil them after an early election.
He seems eager to find out whether the polls showing 50% support for the government are right and whether the approval ratings are realistic or not.
Most parties also seem to favour going to the polls early, although the possibility of forming a new coalition in this term cannot be completely ruled out yet.
An advocate of the latter option seems to be Zdravko Počivalšek, the leader of the coalition Modern Centre Party (SMC), which Šarec mentioned as a potential pre-election ally. He said he did not see the need for a snap election.
In contrast, Janez Janša, the leader of the largest opposition party, the Democrats (SDS), deems an early election by far the likeliest and best option.
Given the current composition of the National Assembly, Janša believes it would be hard to form a solid development coalition.
But he proposes for the time ahead of the election, which he reckons could be held in the second half of April, to be used to pass what he says are urgently needed laws, including a bill on the demographic fund, a bill to cut waiting times in healthcare and a bill on public procurement in healthcare.
Similarly, the opposition New Slovenia (NSi) wants to push through parliament the bill to cut waiting times in healthcare, and amendments to the penal code to step up prosecution of sex abuse.
The NSi, Left, and the coalition Social Democrats (SD) all favour an early election. The new leader of the Pensioners' Party (DeSUS), Aleksandra Pivec, said DeSUS was ready for a fresh election but would want to talk things through in the party before taking any decisions.
Meanwhile, the coalition SMC and the Alenka Bratušek Party (SAB) are not keen on snap election, as is not the opposition National Party (SNS).
Both the SDS and NSi indicated that changes to the electoral law needed after the Constitutional Court found the existing legislation unconstitutional were no longer possible ahead of a fresh election.
Responding to the government collapse, employers and trade unions said this would delay the necessary reforms in healthcare, long-term care, housing policy, labour relationships act, pension reform and other fields.
Trade unions said the start of Šarec's term had been promising, with changes to the minimum wage and abolition of austerity measures, but later the government work came to a standstill due to problems with securing a majority.
Representatives of employers think Šarec "cut the Gordian Knot" today, given that there had been no coordinated political direction or predictability in recent months.
As there are many challenges to be tackled, they want Slovenia to get a new government with a clear political mandate as soon as possible.
Analysts believe the reasons for the government collapse were its relative inefficiency and Šarec's realisation that it would be very hard to secure a majority to appoint two new ministers after the defence and finance ministers stepped down.
"Šarec has apparently assessed that given the degree of its inefficiency, the government would not be able to implement certain measures and he would be eventually blamed for it, so he decided to check the situation in an election now rather than any time later," Domovina news portal editor Rok Čakš said.
In the 16 months in office, the minority government of the LMŠ, SD, SMC, SAB and DeSUS, which was formed after the 2018 early election following Janša's failure to form a coalition even though his party won a plurality of the vote, did not implement any substantial reform.
It managed to push through some changes to pension and tax legislation, but fell short of modifying laws on social affairs.
Two important Constitution Court decisions also remain unimplemented, the one demanding changes to the election legislation and the ruling concerning the financing of private primary schools.
Slovenia's 13th government did, however, manage to pass a record EUR 10 billion plus budgets for 2020 and 2012, both with surplus.
Šarec's term as prime minister will end when the National Assembly takes note of his resignation. This could happen as early as Wednesday. The term of the entire cabinet will end at the same time and the government will assume a caretaker role. A snap election could be held in late April.
According to the latest public opinion polls, Šarec is the second most popular politician in the country preceded only by President Borut Pahor.
His LMŠ party is neck-and-neck with Janša's SDS in topping the party rankings. The most recent poll conducted by pollster Mediana put the LMŠ's support at 15.1%, ahead of the SDS, which polled at 14.1%.
Šarec is the fourth Slovenian prime minister to resign, following Janez Drnovšek in December 2002, Alenka Bratušek in May 2014 and Miro Cerar in March 2018.