24.02.2021

Interview with Dragomir Nikolov: The crisis has made jobseekers proactive and employers more flexible

"In 2020, despite the suspension, more than 10,000 unemployed and employed people were trained, and over 40% of them started working after completing the training. The training opportunities, although intermittent, will be active and up-to-date. in 2021", says in an interview Mr. Dragomir Nikolov, Executive Director of the Employment Agency. Consultancy Center - Berkovitsa provides his answers below.

- Mr. Nikolov, despite the pandemic, the number of people who started work is increasing, what is the reason for this positive statistic?

- 2020 was marked by the beginning of the COVID crisis, which seriously affected the labor market in the country. The closure of a number of sectors of the economy in March and April caused a wave of layoffs and, logically, an increase in the registered unemployed. With the measures taken by the government and our adequate support to provide staff for the restart of closed businesses in the summer months of 2020, a rapid recovery of employment has begun. Despite the pandemic, the Employment Agency increased the number of people who started work by 24% compared to 2019. The total number of people who started work in 2020 was 253,354 people, which means that on average more than 21,000 unemployed people found their jobs per month. For comparison, in the record year of employment in 2019, the average monthly number of people who started work was 18,000. Due to the crisis, a process of restructuring the labor market began. If the demand for labor decreased in the hotel and restaurant industry, the demand increased in the sphere of social services, healthcare, food and beverage processing and logistics. The uncertain market environment has made jobseekers more proactive and employers more flexible. Part-time work, from home, remotely are now opportunities that job seekers are increasingly taking advantage of, and often to combine work in more than one place.

- What employees were most in demand?

- At the height of the pandemic, the most sought after were the operators in the chemical and food industries, as well as in the production of non-woven products. Construction also continued to function smoothly. The new electronic and remote services that the Employment Agency has managed to introduce in the epidemic also help to provide a large number of vacancies to offer people. And the ability to profile job seekers allows us to improve the selection of candidates and direct them to the appropriate positions.

- How many are unemployed to date and what is their percentage compared to a year earlier?

- The number of registered unemployed in the labor offices at the end of January is just under 230,000. This represents 7% of the economically active population of the country in the age range 15-64. If we compare with January 2019 - the year with a record low unemployment, we report an increase in the unemployed by 9.7% or just over 20,000 people. Monitoring of the influx of labor offices last year showed that the COVID pandemic was the reason for the dismissal of 36.5% of the newly registered unemployed. The most affected are those working in hotels and restaurants - 26.7%, trade - 16.4%, transport - 16%.

- What percentage of the unemployed are seasonally engaged, has their number increased given the Covid crisis and by how much?

- Seasonal employment is a characteristic feature and not only on the Bulgarian labor market. If we go back to the fact that in June 2020 the agency reported a record of unemployed people who started working, it can be said that the pandemic has shifted the seasonality of labor supply and demand. What is specific for 2020 is that a significant factor for seasonality was not the calendar months, but the periods of opening and closing of certain economic activities. In the first lockdown, the seasonality of supply and demand appeared in May-June - the period after the state of emergency, and in the second lockdown we expect the effect on employment growth to be in March-April this year, in case of a favorable epidemic and removing current restrictions for some businesses.

- How did the measures maintain the unemployment rate and did you manage to meet the expectations of people seeking help and work?

- The main measure that the agency implements today - 60/40, is perceived by business as a chance to keep trained workers and employees during the state of emergency. Therefore, even after the start of the reception of applications, the number of unemployed began to decline sharply.

I will remind you, for example, that in the week before the start of the 60/40 measure, an average of 7,000 people registered with the labor offices every day, and the following week their number decreased to 3,600 (I.e. almost twice) and continued to decrease. The strongest restraining effect of the measure on the growth of unemployment was felt in the period from April 9 to May 13, 2020, and according to calculations of the Employment Agency, the gross effect of the measure 60/40 is estimated at 114%. This means that if it were not for the measure, the reported unemployment rate at the end of May instead of 8.3% would have been double-digit, at least 10.3%. Proof of the effectiveness of the 60/40 measure is the twice lower flow of newly registered unemployed during the second lockdown. This measure in the period March - June helped more than 10,200 companies and their almost 180 thousand workers. At the end of the year, 1/3 of them already manage to keep their staff on their own and do not participate in it. For the period October - December 2020, nearly 6,800 companies received support for their 145,000 employees.

The measure for the most affected sectors - restaurants, hotels and transport, known as 80/20, ensured the preservation of nearly 30,000 jobs. Here we must add the "Save Me" scheme, which provides income to employees on forced unpaid leave, maintaining the employment of almost 44 thousand people. Along with these measures, others are being implemented. For example, the new scheme "Employment for you", providing at least 6 months of employment for the unemployed (including nearly 11,000), projects to provide caregivers for unemployed parents, to organize training for sought-after professions and skills, as well as existing programs and employment projects funded by the state budget and European funds, covering a total of over 25,000 unemployed.

In short, I would like to say that in the absence of existing and new anti-crisis measures, the average annual unemployment rate would be 13.4% and we would start 2021 with over 200 thousand more unemployed, i.e. almost twice as much as reported at the end on December 220 thousand registered in the labor offices. So, I hope we have largely met the expectations of people looking for help and work.

The excellent communication between the colleagues in the agency with the other responsible institutions - MLSP, NSSI, NRA, the labor inspectorate and others has a very big role for this positive statistics.

- How did the agency manage to cover all the needs of the people?

- We did not close the doors for anyone, we even took over the client flow from the National Social Security Institute, and we started accepting applications for unemployment benefits. Many people know that we outsourced our services to the offices of labor offices, somewhere we even opened new receptions and continued to serve people in remote areas. The important thing is that our experts managed to combine the new volumes of work with their main professional commitments, for which I would really like to thank them. It is important for people who seek support to submit the documents with which they want support correctly, this will ensure timely and quick help.

- You have had various campaigns for training and qualifications in order to reduce the unemployed, is there interest and those wishing to acquire additional skills for work?

- As in the first lockdown and now, since November 2020, the present group classes in language, training and qualification centers and other training schools have been suspended. At the moment, in accordance with the order of the Minister of Health, face-to-face trainings and examinations can be conducted only for acquiring legal capacity by profession.

As an example, I give you the "Youth Employment" scheme. The procedure is not new and offers two options - on-the-job training in a new profession under the guidance of an experienced mentor or internship for unemployed young people in the specialty acquired with education. This scheme has proven to be very effective for young people, because over 52% of the young people involved remain with the same employer.

In 2020, despite the temporary suspension, more than 10,000 unemployed and employed people were trained, and over 40% of them started working after completing the training. Training opportunities, albeit intermittently, will be active and relevant in 2021.

- What will the Employment Agency offer this year to maintain the unemployment rate?

- Until the end of March 2021, the Employment Agency continues to implement anti-crisis measures for the sectors affected by the pandemic - namely 60/40, 80/20 and "Save me". Measures to stimulate the employment of unemployed persons "Youth Employment", "Parents in Employment", "Employment for You", as well as programs and measures of the National Action Plan for Employment for this year continue.

I would like to draw your attention once again that in a different form, according to the current epidemic situation, the provision of our services will continue to activate the unemployed and learners, as well as job seekers. The approval of the new Program "Human Resources Development 2021-2027" is forthcoming, which envisages the provision of more than BGN 2.2 billion for employment promotion, acquisition and development of skills through trainings, internships and practices, as well as activating the unemployed and non-learners.

- The National Action Plan for Employment in 2021 provides for the creation of more jobs, tell us more about it.

- In 2021, priority will be given to the discharged persons due to the epidemic situation, who are registered in the labor offices, with the youth, with the so-called NEET's (unemployed and uneducated youth), with the unemployed without qualifications, with disabilities or long-term unemployment and other vulnerable groups. The "Career Start" and "Melpomene" programs have already started. In March, the procedures for applying for employers and the unemployed to use subsidies under other programs and measures to ensure employment of the unemployed in pre-retirement age, with permanent disabilities, long-term unemployed, young people, low-educated or unskilled, parents of children up to 5 years and others.

During this year the amount for financing the labor remuneration of the unemployed persons included in subsidized employment has been increased, as it varies from BGN 500 to BGN 950, depending on the specific program or measure. With the funds from the state budget it is envisaged to provide employment to a total of 14,495 unemployed persons and training for 11,599, incl. 1200 employees in medium, small and micro enterprises.