01.10.2021

IN FIVE MUNICIPALITIES, 20% OF PEOPLE HAVE BEEN OUT OF WORK FOR MORE THAN A YEAR

The Covid-19 crisis has significantly changed the labor market in Bulgaria, with restrictions leading to a significant increase in unemployment in many regions of the country, especially in municipalities with traditionally more active labor markets, according to information from employment offices published by the Employment Agency, shows an analysis of the Institute for Market Economics (IME).

The data of the agency allow us to look at the permanent unemployment, through the data on the unemployed with registration in the labor offices for at least one year. While the presence of unemployment within certain limits is normal for a functioning labor market and a sign of labor mobility, long-term unemployment speaks only of the presence of insurmountable structural problems.

A map made by the IME visualizes the share of the long-term unemployed in the period from the end of 2019 to the latest available data and clearly demonstrates that this phenomenon is typical, above all, for Northern Bulgaria, and almost half of the municipalities in which it affects 8 % of the workforce are concentrated in the Northwest, the analysis said.

By the middle of 2021 in five municipalities - Hayredin, Ruzhintsi, Dimovo, Yakimovo and Kaolinovo registered unemployed for over a year exceed 20% of the economically active population, and more than 10% are in 36 municipalities. On the other hand, with less than 1% permanently unemployed are 100 municipalities, without any - five. In the leading economic centers - Sofia, Plovdiv, Varna their share is below 0.1%.

The impact of the crisis on long-term unemployment is visible in the comparison between its level at the end of 2019 and 2020, as it has increased in 117 municipalities, and in 18 of them - by more than 1 percentage point.

By mid-2021, the number of municipalities in which the indicator has deteriorated compared to its pre-crisis level has risen to 131, and many of those in which it is improving have initially high levels of permanent unemployment and the improvement is a logical step in period of growth in which the economy is from 2021. In the country as a whole the number of unemployed with more than a year of registration has increased from 42.3 to 44.4 thousand people.

Judging by the data published by the Employment Agency, we can conclude that the crisis has not significantly affected long-term unemployment in most regions, especially because the registered increases are not particularly high.

And by the middle of 2021 this type of unemployment remains localized mostly in Northwestern and Northeastern Bulgaria. Another question, however, is the number of permanent dropouts from the labor market as a whole, something that the data of the Employment Agency cannot show, the IME concludes.