Romania is facing its toughest workforce crisis in the last decade. Companies complain they can’t find employees, while people consider salaries too low and prefer to go abroad for better jobs or stay at home and benefit from state aid.
Friday, 11.45 a.m. It’s already hot: 31° Celsius. At the entrance of Titu, a small town in southern Romania, near Bucharest, the national road is blocked by dozens of cars looking for a parking spot. Two policemen guard the barrier ahead.
It’s the annual three-day fair in Titu. The smell of roast pork fills the air. Hundreds of stands spread as far as you can see, selling everything from shoes and horse equipment to candyfloss and artificially coloured juices. It seems as if every other kiosk has its own music, played as loud as possible. You can hardly hear yourself speak in the general roar of the place.
Hundreds of people crowd among the stands. A 7-year-old boy drinks blue juice and throws the plastic glass on the ground. His father, in his 40s, looks at him, smiles and asks if he wants another one. Music. Beer. Bumper cars. Ice-cream. Jeans. Smoke. Typical small-town fair atmosphere.
Cornel is 47. With a plastic bag and a bottle in his hands, he walks relaxed in his grey tank top and slippers. “I haven’t worked in years. I stay at home and take care of the animals. My wife supports me. She works at the store,” he says laughing. Then he stops to buy some gingerbread for the kids of his grey-haired friend, next to him, who works in Spain, picking oranges, and is now home on vacation.
Overall, hundreds of thousands of employees are still needed countrywide.
None of them has even thought of going to the job fair organized by the authorities at the same time. In downtown Titu, in an elegant tent, 22 companies were looking for 385 potential employees, mostly workers. The event started at 10 a.m. and one hour later it was already finished. “Only 30 people came. We put posters in town halls, in the mass media, we talked to the people. In vain. They are not interested. How can we compete with the fair?” says Cezar Dinca, deputy director at Dambovita County Employment Agency, who organizes around eight such events per year.
Romania is facing its toughest workforce crisis in the last decade. On one hand, companies complain they can’t find employees, either highly skilled or novices. On the other, people say salaries are too low and many prefer to either leave for better jobs abroad or stay at home and benefit from state aid. Overall, hundreds of thousands of employees are still needed countrywide. The construction sector alone lacks some 250,000 workers, skilled or not.
This situation didn’t happen overnight. The process started in 2007, when Romania joined the European Union. Over half a million people emigrated that year, mostly highly skilled workers, according to data from the National Statistics Institute (INS).
The process has continued ever since, though not at the same pace. The exodus saw another peak in 2017, the largest in the last eight years, when almost 220,000 Romanians, mostly young people, decided to emigrate. Basically, last year Romania lost a group of people larger than Ploiesti, a middle-size city, or than counties such as Covasna or Tulcea. It was a year with record economic growth, with salary and pension increases, but also with huge political protests, disastrous reforms and attacks on the independence of the judiciary.
“We’ve never had such workforce instability like this year. We hired 237 people seven months ago and 206 have already left. We need 200 more to complete our ongoing projects,” says Mircea Bulboaca, owner of construction company CON-A, which has been on the market for 28 years. “We offer net salaries of EUR 400 to EUR 1,000. They simply don’t come. All the specialists have gone abroad. I’m thinking of bringing workers from Vietnam. I’ve already signed a contract for the first 50 people,” he adds.
In spite of the almost 30,000 jobs officially available at the National Employment Agency (ANOFM), the labour market is vulnerable and under pressure. The unemployment rate is low, at 4.4%, and occupancy rate was 68% in March, according to data from the Central Bank. The real problem relates to the inactive people who don’t seek work. One third of the people aged 15 to 64 were inactive at the end of last year and almost half didn’t even graduate from high school.
“It’s a huge deficit of highly educated people among the active population of the country and a lack of specialists, with five to ten years of relevant experience in a certain area. Added to this is the mindset of the younger generation born after 1981, that has a different attitude towards work compared to the previous generation,” says Bogdan Stanciu, managing director at software company Bit Soft.
In Titu, the last companies gather their things at the job fair. They are disappointed. “Only three people came to us. One asked for a referral to prove he is not fit to work. What can I do with this guy?” said the representative of a company that was looking for ten workers for its local factory. She said the factory was offering RON 1,500 (EUR 326) net salary for an unskilled worker, plus food and transport. Other companies offered up to RON 5,000 (EUR 1,000) for skilled workers.
Referrals to prove they are unable to work are common requests from people who have got used to not working and rely on the few hundred lei offered as state aid. “Most of the people who come here don’t want to work. If the state offers them free money, why should they work? They see state aid as a lifetime pension, with no strings attached,” says Cezar Dinca from the Dambovita County Employment Agency.
The real problem relates to the inactive people who don’t seek work.
Almost a quarter of a million people rely on state aid in Romania. To cover their need for specialized craftspeople, which the national educational system doesn’t consider, companies have started to train students themselves. CON-A, for example, finances a vocational school for locksmiths, blacksmiths and carpenters. “Last year the first class graduated. 12 students out of 25 finished school. Three of them came to work with us. Two left last year. One left a few months ago,” said Bulboaca from CON-A.
According to its owner, the medium net salary at CON-A is over RON 3,200 (almost EUR 700), which is reasonable income for Romania. Bulboaca said he has tried to bring back skilled workers who left to go abroad, aged 35-45. They said it’s not only salaries that keep them away from Romania, but the poor educational system, the poor health system and the troubled political situation. At national level, the minimum net salary in Romania has increased by almost 250% during the last decade, from EUR 120 in 2008 to EUR 291 at present.
It’s 2 p.m. at the annual fair in Titu. Nelu walks among the stands, eating an ice-cream. At almost 60, he is a construction specialist who has worked in different countries. “I came back to Romania and they gave me RON 1,500 (around EUR 300). What can I do with so little money? My monthly expenses exceed RON 2,000,” he says. He invested his savings into a fur sewing machine workshop and travels throughout the country to sell his products.