Tag Archives: Labour market @en

Unemployment in Bulgaria 2023

Unemployment in Bulgaria continues to be a significant issue in 2023. Despite the country’s slow economic growth in recent years, the COVID-19 pandemic has led to the closure of many businesses, resulting in a further increase in unemployment.

Situation has improved over the past year.

In March 2023, the unemployment rate in Bulgaria is projected to be around 3.7 percent (compared to 4.5 percent in March 2022), according to the latest data from the European statistical authority, EUROSTAT. While this rate may not be very high compared to other EU countries, the number of long-term unemployed individuals is a cause for concern. Many people are struggling to find jobs, especially in rural areas and regions with lower economic development.

However, there have been positive developments as well. The Bulgarian government has launched various initiatives to promote employment, including support for start-up companies and the creation of incentives for job-creating businesses. Training and retraining programs have also been implemented to enhance employment opportunities for the unemployed.

The government is also committed to developing infrastructure, particularly in remote regions, to facilitate job creation in these areas. Another important step is to increase investment in the technology and service sectors, as these industries have high growth potential.

Unemployment in Sofia almost non existing

In major booming regions, particularly in the capital city of Sofia, as well as Plovdiv, Burgas, or Varna, unemployment is not a major issue. Qualified workers are in high demand, and there is nearly full employment. Sofia, with its emerging IT industry, and Plovdiv, with a strong industrial base, are experiencing widespread shortages of skilled workers.

In these major growth centers, such as the bustling capital of Sofia and the industrial hubs of Plovdiv, Burgas, and Varna, the unemployment situation is not a significant concern. Skilled workers are in high demand, and there is nearly full employment. Sofia, with its thriving IT sector, and Plovdiv, with its robust industrial base, are grappling with a widespread shortage of highly skilled professionals.

Efforts to address the unemployment issue extend beyond these urban centers. The Bulgarian government recognizes the need to bolster employment opportunities in rural areas and regions with lower economic development. Consequently, they have implemented various measures to uplift these areas. One crucial aspect involves investing in infrastructure development, particularly in remote regions, which not only improves connectivity but also facilitates job creation.

Additionally, the government has prioritized increasing investments in the technology and service sectors, acknowledging their immense growth potential. By fostering innovation and entrepreneurship in these industries, Bulgaria aims to generate new job opportunities and boost economic prosperity.

Moreover, the government has introduced programs aimed at fostering a skilled workforce. These initiatives include vocational training and retraining programs designed to enhance the employability of the unemployed. By equipping individuals with in-demand skills and qualifications, these programs strive to bridge the gap between job seekers and available employment opportunities.

While progress has been made, it is crucial to continue supporting and promoting initiatives that combat unemployment in Bulgaria. Collaboration between government entities, businesses, and communities is vital to ensure sustained economic growth and reduced unemployment rates throughout the country.

In conclusion, although unemployment remains a significant challenge in Bulgaria, positive steps have been taken to address the issue. The government’s commitment to promoting employment, investing in infrastructure, and fostering growth in key sectors demonstrates a proactive approach. However, ongoing efforts and support from various stakeholders are essential to further alleviate unemployment and create a thriving job market for all Bulgarians.

Minimum wage in Germany from January 2015

With the beginning of 2015 Germany introduces for the first time in its history a general minimum salary. Until now Germany was one of the few European countries without such a standard. Employers are obliged to pay their employees an hourly gross salary of not less than 8,50 Euro beginning in January. According to calculations of the German government about 3,7 Million people are currently earning less than that and will benefit from the new legislation.

The minimum wage will be attuned to the salary level development on the German market on a regular basis by an independent commission with members from both labour unions and employer organization.

Minimum wage Germany
Minimum wage in Germany from 2015

Minimum salary valid for Bulgarians

The new minimum wage will cover all employees that work in Germany, no matter what nationality. Furthermore, also foreign companies have to comply with the requirements of the minimum salary law (with the official, not very reader-friendly name “Tarifautonomiestärkungsgesetz”) and pay their delegated staff at least the defined hourly salary of 8,50 Euro. This can be the case e.g. for Bulgarians that are send to Germany to do services – but working on a Bulgarian labour contract.

Correlation with Arbeitnehmerentsendegesetz

For several business branches a minimum salary is no news at all: The Arbeitnehmerentsendegesetz-law which was introduced in 1996 and fundamentally revised in 2009 defined minimum wages for several industrial sectors such as construction, cleaning, and health care.

The Arbeitnehmerentsendegesetz is binding for foreign companies once they are active on the German market. As the name indicates the intention of it was to avoid dumping competition of foreign companies that pay wages below German standards to their employees. The minimum wages vary depending on the particular industry but are in general higher than the newly introduced general minimum salary. In case that one of the defined rates is higher than the 8,50 Euro, employers will have to continue to comply with the well-known Arbeitnehmerentsendegesetz and transfer remunerations above the 8,50-threshold.

Accountability of companies under new minimum wage law

The new Tarifautonomiestärkungsgesetz which regulates the minimum wage points in its §14 “Accountability of purchaser” to the respective norm of the Arbneitnehmerentsendegesetz which is to be used here as well. Accordingly companies bear responsibility if other companies that fulfil service contracts for them violate the minimum wage norm. They may be charged for malpractice of sub-contractors with administrative offence of up to 500.000 Euros per case. It will be highly advisable that companies avoid this risk by including rights of exemption in their contracts with sub-contractors.

German IT companies barely looking for staff abroad

Over the last two years at least one in five German IT companies has had to refuse a client request owing to lack or shortage of qualified personnel. In spite of this, few companies have considered the opportunity for looking for qualified IT staff abroad: a total of 85% of the IT firms that participated in a survey of the situation of the job market conducted by Monster.de and CeBIT said that they have neither hired staff from abroad, nor have ever considered it as an option. Some 200 German IT-companies took part in the study presented by the Personalwirtschaft journal in a recent publication which outlines its main findings.

The article refers to the study’s conclusions that companies are calling for simplification of the processes for recognition of foreign university degrees. Another issue that firms have unanimously pointed out is easing the conditions for entering and staying in Germany.

Germany’s IT industry could be left out of the global ‘War for Talents’

The situation with German IT companies active in the field of employer branding is slightly different. According to the survey, some 64% of these companies are willing to attract more applicants (and to set incentives for their core workforce to stay with the company) through increasing salaries. Some 69% of the firms have stated readiness to boost the employment appeal of their jobs in order to attract new personnel.

Flexible recruitment called for

Long-term success could be guaranteed only through combining several employment channels. In addition to increasing their attractiveness as an employer or in developing an employer brand, in 2013 the firms in the German IT sector should start actively searching for and contracting expatriate staff. This would not only lead to filling in vacancies, but also to stabilizing labor costs, since the wage expectations of foreign applicants are usually lower than those of their German counterparts.

Number of Bulgarians working in Germany increasing

The number of Bulgarians who apply for a social insurance in Germany is constantly growing. As recent figures of the Federal Employment Agency show, in 2012 the number of Bulgarian working in Germany stroke a new record at 25 840.

German labour market – very popular

Since 2000, the employment in Germany has been registering annual increases. What is striking is the rapid rate of increase of the Bulgarians in Germany particularly in the years 2010-2012. During this period, the number of Bulgarians who make their living in Germany grew by about 5000 people annually. This can be explained by the poor economic situation in Bulgaria that until about 2008 experienced a genuine economic boom. The quick recovery of the German economy after the crisis and the ensuing demand for working force may have also contributed to the growth of Bulgarian immigration.

Zahl der Bulgaren, die in Deutschland arbeiten.
How many Bulgarians are working in Germany? The graph shows a constant increase from 2000  to 2012.

The trend is expected to continue in 2013 – 2014

The rising Bulgarian workforce flow to Germany is expected to continue in 2013, although the weaker German labour market could curb the rate of increase. As for 2014, when regardless of the economic development of Europe the transitional restrictions for Bulgarians are due to fall off, the dynamics of the immigration inflow to Germany is certain to gain momentum. Therefore, the number of Bulgarians seeking employment in Germany is expected to reach record–high levels over the coming years.

In 2013 Balkaninvest HR consultancy will continue to support this workflow dynamics so as to adjust it to the needs of German employers and to assist them with professional services.