site.btaAnalyst Warns Bulgaria Will Be Short of Half Million Employees in 3-5 Years

Longer-term labour forecasts for Bulgaria are presented in an analysis by Institute for Market Economics (IME) Senior Economist Adrian Nikolov, published on the IME website on February 9. Nikolov says that employers in the capital Sofia expect far more significant staff shortages in the next three to five years than those in other parts of the country. In terms of economic sectors, it will be necessary to expand employment mainly in trade, tourism, the economy and the teaching profession.

Employers expect high economic growth and business expansion opportunities over the medium term. Estimates are that the country will incur a deficit of 243,000 experts with higher education and 245,000 employees with secondary education. In other words, the staff shortage (which, given the very low labour supply at present, seems rather hard to reverse) will come close to half a million people in three to five years' time, Nikolov says.

Trade, tourism and transport are forecast to become short of 194,000 employees. This is due, on the one hand, to a large current staff deficit in hotels and restaurants, which will become even larger as the tourism industry grows in the next few years, and on the other hand, to the rise of modern trade and the increasing importance of logistics. The need for more workers will also be considerable in industry (68,000) and construction (46,000), and the sectors of civil service, healthcare, education and social services taken together (73,000). Understandably, the last three sectors in this mixed group are likely to experience a much greater shortage of people with higher education, whereas in industry the demand for more workers with secondary education will be about twice the demand for additional staff with higher education. In construction, the two education levels will be in equal demand.

Employers say that specialists with secondary education will be most in demand in wholesale and retail trade (where there will be 26,000 unfilled job positions); hotels, restaurants and catering (15,000); and construction (14,000). The shortage of people with higher education will be most acute in the economy, where an additional 14,000 employees will be needed (with trade, transport and tourism accounting for almost half of the shortage of economists). The same number of 14,000 additional employees will be needed in the teaching profession, and also in information technology, and 11,000 additional workers will be in demand in tourism. It is worth noting the considerable expected medium-term deficit of doctors and nurses: almost 16,000 people, which will make them most in demand among people with higher education, Nikolov says.

While at present labour demand is quite evenly distributed among Bulgaria's leading regional labour markets, over the medium term it will become concentrated almost entirely in Sofia, where 213,000 additional employees, mainly with higher education, will be sought. Varna comes second, far behind Sofia, with 34,000 more people to be needed, followed by Plovdiv (33,000) and Burgas (32,000). In most of the large regional labour markets (excluding Sofia), the need for workers with secondary education will be most tangible.

Of course, long-term forecasts should be used not so much for individual business planning as for setting the general direction of labour market and education policies. Rather than showing the concrete current needs of employers, such forecasts indicate their expectations about the future, assuming that the current macroeconomic and sectoral trends persist. Even if it turns out that three to five years from now Bulgaria is short of just 200,000 employees, and not half a million, still there is no solution in sight at this point. Demographic data suggest that the working-age population will decline rapidly; the policies for integrating economically inactive people and those with limited access to the labour market have stalled; and Bulgaria is definitely not among the most attractive countries to foreign workers. These three facts provide perhaps the strongest arguments for working to offset the expected labour deficits, Nikolov says.