by ani | Jul 16, 2025 | Economy @en, Europe @en
The free movement of people within the European Union has changed the labor markets and allows citizens to move to where they see the best opportunities for work. But for countries like Bulgaria, this mobility poses a double challenge: brain drain, the loss of skilled labor, and the potential for brain gain, the return of talent and knowledge. Since joining the EU in 2007, labor migration has had a profound impact on the country and is one of the biggest socio-economic challenges.
The brain drain phenomenon in Bulgaria
Bulgaria is one of the regions most affected by the brain drain worldwide. Since 1990, the country has lost around 22 percent of its population, and forecasts point to a further decline of 23 percent by 2050. The population has shrunk by over one million people since 1989, from 7.9 million to 6.4 million in 2024. This decline is also reflected in the annual population change rate: as shown in chart 1, this rate has been negative since the mid-1980s (1985: -0.08%) and reached its lowest point at -1.21% around 1993/1994. In 2024 it will still be -0.61%, for 2025 a rate of between -0.6% and -0.83% is forecast, and by 2050 it will remain negative at -0.89%. This development is largely driven by low birth rates, high mortality rates and, above all, emigration.
Causes of Migration: The Pull of the West and Internal Problems
The main causes of emigration lie in the significant economic disparities within the EU. Bulgarians leave their country in search of higher wages, better job security, and improved living conditions in Western Europe. Although the gross domestic product (GDP) per capita has increased from 1,625 USD in the year 2000 to 17,588 USD in 2024 and is projected to reach 24,894 USD by 2030, the absolute level remains low compared to the EU average—making emigration still an attractive option.
The possibility of earning twice as much for the same work, or even getting more for less qualified work, is a strong incentive. In addition, there are internal problems such as corruption, weak public services, a lack of meritocracy, a poor work-life balance, a lack of professional development and outdated workplace cultures that encourage young people to leave.
Effects: Shortage of skilled workers and burden on the economy
The effects of the brain drain on Bulgaria are serious: it is leading to a decline in human capital, slowing economic growth and reducing productivity and tax revenues. Certain sectors have been hit particularly hard: the healthcare sector has been severely affected, with the number of doctors falling from 35,000 to 28,000 by 2017. Since 2007, over 15,000 Bulgarian doctors and 20,000 nurses have left the country, as a doctor in Germany can earn five to six times as much as a Bulgarian colleague. The IT sector is also suffering from the loss of qualified workers, who are migrating to countries with better salaries and career opportunities. Overall, the Bulgarian economy is predicted to face a shortage of around 400,000 qualified workers by 2017. This will lead to a shortage of skilled workers in construction, healthcare, education and engineering.
Profiteer Germany: The “transfer of wealth”
Germany benefits greatly from this development: it is the preferred destination country for Bulgarian migrants. In 2024, there were 371,128 Bulgarian citizens living in Germany alone, followed by Spain (112,834) and the Netherlands (60,494), which clearly shows the distribution in the EU.
Many of them are better educated than average. Germany has a total of 8.9 million immigrant workers. Immigration from Eastern European countries has slowed down demographic change in Germany and helped to secure a supply of skilled workers. Without doctors from Eastern Europe, there would be no medical care at all in certain regions of Germany. This development is often referred to as a “transfer of wealth”, as countries such as Germany receive workers in whose training they did not have to invest.
The potential of brain gain for Bulgaria
Despite the challenges, labor migration also offers opportunities for Bulgaria, particularly through brain gain. This can take place in various ways: through the return of Bulgarians who have acquired new skills and knowledge abroad, or through the transfer of knowledge and capital through the Bulgarian diaspora.
In fact, there is an increasing tendency to return to Bulgaria, which has increased especially during the COVID-19 pandemic. Data from the National Statistical Institute (NSI) confirms a steady increase in returnees over the last decade. Bulgaria has a high proportion of migrants who are nationals, which indicates significant return mobility. These returnees can bring new knowledge, skills and innovations to the country, build networks and establish international contacts. Remittances are an important aspect of capital transfers: As shown in Figure 5, between around USD 115 million (in 2015) and over USD 420 million (in 2024) flowed annually from Bulgarian migrants to Bulgaria between 2014 and 2024. This shows a significant increase, with the highest value in 2024.
Examples of successful returnees or initiatives that promote brain gain are crucial.
Strategies to promote brain gain
In order to minimize brain drain and fully exploit the potential of brain gain, targeted measures are required at various levels.
The Bulgarian government has begun to develop strategies aimed at the return of its citizens. The National Migration Strategy of the Republic of Bulgaria (2021-2025) provides for programs to support returnees and promotes campaigns to encourage return. These include financial incentives, job search and integration support and the promotion of business start-ups by returnees. A key element is also the granting of Bulgarian citizenship based on descent in order to strengthen ties with the diaspora.
It is also important to strengthen ties with the Bulgarian diaspora in order to promote knowledge exchange and foreign investment. On a broad level, working conditions and salaries must be improved domestically. Investment in education and research as well as the fight against corruption and strengthening the rule of law are also essential to make the country more attractive. EU cohesion policy plays an important role here in reducing economic and social disparities between the regions.
Conclusion and outlook
Bulgaria faces the complex task of stemming the ongoing brain drain while at the same time harnessing the potential of return migration. The phenomenon of brain drain is directly attributable to the existing socio-economic imbalances within the EU, and although the EU institutions have introduced mechanisms to reduce these disparities, these have so far only been partially effective.
A holistic approach that includes both measures to stem the brain drain and to promote brain gain is crucial. This requires cooperation between politics, business, the education system and civil society in Bulgaria as well as a dialog between the countries of immigration and emigration. Although the brain drain of doctors is not a pressing problem at present, innovative funding approaches could be considered in the future if shortages in key professions occur.
Return mobility could be a possible solution to Bulgaria’s demographic crisis, although it has decreased since 2020. With targeted policy interventions, Bulgaria can further improve the benefits of migration and reduce the risks. The country has the potential to minimize the brain drain and benefit from the brain gain if it succeeds in creating attractive prospects at home and strengthening ties with its expatriate population.
by Balkaninvest-Team | Oct 27, 2015 | Europe @en
The refugee crisis presents the EU with a big challenge. Especially Germany and Austria have to cope with it. In September 163,772 new refugees have been registered.
Curse or Blessing for the labor market? The Balkaninvest-Team starts with this post a series of blogposts on this hot toppic!
Refugee crisis and labor market
Differences in the refugee process between Austria and Germany
Refugees in Austria have three month after acceptance for asylum procedure access to independent and dependent work. They are offered time-limited work permits for the following areas:
- Seasonal or harvest work
- Working as journalist, artist, sports teacher or language trainer
- Charitable work
- EUR 100/month additional earnings
- (holiday) internship
- Voluntary work
Once they are granted asylum they are coequal to Austrians except for the voting rights and have free access to the employment and apprenticeship market. Refuges who are not granted asylum but who also cannot be deported to their homeland because of safety reasons are allowed to work and have unrestricted access to the apprenticeship market
In Germany approved refugees with residence permit are allowed to work without restrictions. Additionally there is the suspension of deportation. The suspension is granted to refugees who are not deported although their asylum application has been rejected. This refugees and refugees with residence permit have access to the labor market after three month.
A disparity to Austria is the priority check. German employees or employees from the EU member states have priority over refugees for vacancies.
But because of the current positive labor market situation and the high number of job vacancies (retrieved 9 September 2015) there could be changes in the priority check anytime soon.
Barriers for refugees on the labor market
Beside country-specific differences in job training and practicing it is also important to consider that many refugees only have compulsory education and often are faced with problems concerning the Latin alphabet. Many of them have professions which almost do not exist any more in Europe like carpet makers or fishermen. Most do not own documents or credentials.
In addition to that it can be difficult for them to work in a regulated work environment because of traumatic experiences and their consequences caused by the war.
Integration of refugees on the labor market
In the meantime there are offered online education and employment platforms like Workeer or Mygrade, which connect job seekers and employers and enable an easy application.
Once a refugee is recruited it is advantageous to nominate an employee which cares about the special needs, concerns and problems and simultaneously enable them an easy entrance into the employment market.
by Balkaninvest-Team | Apr 14, 2015 | Europe @en, Personal @en
According to a study by the Staufenbiel Institute in 2015, German employers are optimistic towards the developments in the labour market for graduates. Even though a decreasing number of companies expect an increasing need for graduates compared to the last years, pessimistic forecasts for most disciplines are an exception.
In 2015 particularly economists are in demand. For almost 45 percent of the offered positions, of which half are positions for internships, graduates with an economic background are needed. 3% of the companies forecast a rapidly growing demand for economists for the next five years.
Increasing demand for engineers and computer experts
Compared to the previous year the forecast for the demand for engineers and computer scientists is slightly less optimistic but still positive. For engineers, 35 percent of the employers (2 percent less than last year) expect a rising or significantly rising demand. Over the next five years, this amount will rise up to 63 percent which means a decreasing tendency in comparison to the forecasted increase in demand last year (68 percent).
The predictions for IT graduates remain nearly unchanged compared to the previous year. 38 percent of the companies expect rising and 8 percent significantly rising demand. The job prospects remain bright in the future: 51 percent of the companies expect an increase and 51 percent a strong increase for the demand of computer scientists.
Focus on interns
Almost half of all graduates jobs are provided for interns (44 percent). 6% of the jobs are for trainee programs and 18% for young professionals. The remaining workplaces are split up between graduates (27%), clerks (3%) and associates (2%).
In computer science, the distribution focuses less on internships (35%) but more on young professionals (31%). Workplaces for engineers are offered especially for interns (43%) and graduates (29%). Trainee positions are for IT graduates (4%) and engineers (3%) less frequently offered.
Employers prefer Master’s degrees
Inside application processes primarily Master’s degrees are preferred. 90% of the companies favour this type of degree over a University Diploma (76%), a University Bachelor’s degree (60%) and a Diploma of a University of Applied Sciences (55%).
This tendency can be also detected for engineers and computer scientists. 97% of all companies prefer engineers with Master’s degrees and 92% prefer IT graduates with Master’s degrees. The Diploma of a University of Applied Sciences in Computer Science (54%) and Engineering (63%) is clearly preferred over a Bachelor’s degree. A Bachelor’s degree in Computer Science is preferred by 47% and a Bachelor’s degree in Engineering by 36% of the companies.
by Balkaninvest-Team | Dec 16, 2014 | Europe @en, Personal @en
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 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.
by Balkaninvest-Team | Feb 5, 2013 | Economy @en, Europe @en, Personal @en
The publication of an OECD report on the immigration of foreign workers to the German labor market has prompted keen media interest over the last few days.
After we reported only last week about the lack of sufficient interest of German IT companies to searching for qualified staff abroad, we are now presenting a comprehensive economical study of the OECD (Organization for Economic Co-operation and Development).
The study describes that the access to the German labor market as relatively easy (compared to other OECD member countries). Yet numbers suggest that in Germany, in spite of the alleged shortage of skilled workers, the market share of labor migrants from outside the EU and the European Free Trade Area (EFTA) accounts for a fifth and even tenth of the share of other studied countries such as Australia, Denmark, Canada and the United Kingdom.
SMEs account for considerable difficulties with migrant workers
The situation with Small and Medium Enterprises (SMEs) could be described as problematic. These types of businesses often encounter serious difficulties in finding suitable staff from abroad, which is apparent from the graph illustrating the results of the surveyed companies. .
Indeed, the shortage of skill workers is far more common in SMEs than in larger firms,
In contrast to big companies, SMEs have no international intercompany personnel exchange to facilitate recruitment of expat employees.Therefore the report recommends employers – especially SMEs – put more effort into looking for qualified personnel aboard if they cannot meet their need for skilled workers on the local labor market, the OECD says.
One of the many explanations of the problematic situation is that both at home and aboard the German immigration system is perceived as restrictive and difficult to access, argues the OECD report.
OECD recommends coining of an immigration strategy
Yves Leterme, Deputy Secretary-General of the OECD, advised for a consistent immigration policy during the presentation of the study on 4 February 2013 in Berlin. Without such an approach, meeting the projected shortage of skilled workers would be difficult: ‘The prosperity of Germany is largely dependent on whether it will be able to stay competitive despite its aging population.’
Read the full OEDC study ‘Immigration of foreign workers: Germany’ by clicking on the PDF thumb below.
