20.05.2021
VISION FOR TRANSFORMATION OF THE BULGARIAN ECONOMY IN THE POST-COVID DECADE
Analysis of the Bulgarian Chamber of Commerce
The transformation of the Bulgarian economy in the next decade is both necessary and inevitable. This is because some of the well-known statistics are very worrying and not typical of an EU Member State or even a developed country. According to the World Population Review (2021), Bulgaria has the highest mortality rates in the world in 2021. In this respect, it is ahead of developing countries. Bulgaria is also at risk of ambient air quality, with the most serious exceedances observed in the indicators SO2 and PM10 according to the European Commission (Press release IP / 19/4256. Brussels, 25 July 2019 and others).
Exactly these two indicators are sufficiently indicative of the state of an economy. On the one hand, they provide information on the level of quality of life in a country. This affects the desire for migration, which in turn affects the size of the active workforce and at the same time consumer demand (which is one of the main factors for the growth of Bulgarian GDP). On the other hand, these two indicators affect the opportunities for attracting foreign direct investment: declining skilled labor force, poor potential of the domestic market for consumer demand, poor ambient air, combined with very high mortality, indexing a low level of health - repel the desire of foreign specialists to be seconded to Bulgaria. This largely explains why in recent years foreign direct investment has surrounded us and targeted our neighbors who are not even members of the EU.
Even with only two indicators can indicate the need for transformation of the Bulgarian economy in the next decade. And many more can be listed.
COVID-19 has caused the worst global economic crisis in nearly 100 years. This is not the first global economic crisis, but it is the first global crisis of an exogenous nature. That is why economic policies constructed on the vision of instrumental management of endogenous cyclicality have failed.
Until now, the Bulgarian economy has relied on classical macroeconomic policy. Leading role of fiscal policy in combination with balanced participation of monetary policy (there are different classifications for the types of economic policy).
But the annual growth rate of economic policy so far can hardly be called convergent. PPP-based calculations do not take into account the difference in the quality of goods offered by the same company for high and low purchasing power markets. And when using indicators based on current prices - e.g. GDP / capita, the difference is 4 times compared to the EU-27 average.
This requires its change in direction:
First, the strategic use of targeted manageable budget deficits. There is nothing wrong with using budget deficits when they are targeted (support important structural reforms in the economy) and manageable (economic growth keeps them at low risk).
Second, assessing the risks of long-term zero interest rate policy: "liquidity trap", "closed economy effect", "escape to cryptocurrencies", etc. Especially in exogenous shocks, the combination of zero interest rate and currency board is not effective enough. Cryptocurrencies and quasi-monetary aggregates created by private non-financial entities will still create strong pressure on public monetary policy in balancing it between the interest rate and the amount of money in circulation.
Third, the maintenance of normative fixed prices, normative fixed wages, "artificial" employment exhausts the economy, not supports it. In such cases, the level of the so-called "gray economy" or human labor is replaced by productive capital and the opposite effect occurs. These are some of the reasons for the existence of structural problems in some economic sectors.
Fourth, digitalization of the economy and the public sector, combined with constant and real professional development of the workforce. Digitalization is happening globally and at a rapid pace. If Bulgaria lags behind in this process, it will not be able to catch up with the other countries. At present, the potential for economic growth based on the low cost of labor has been exhausted because unemployment, even in a pandemic, is close to a minimum. This means that accelerating growth can only be based on digitalisation and GDP restructuring.
Fifth, a change in the structure of the fiscal burden (which is different from the tax burden). The focus of restructuring must be on so-called 'quasi-taxes'. The overall fiscal burden in Bulgaria is quite high compared to other developed countries. This process must be carried out in parallel with the restructuring of the health system, energy and other unreformed sectors.
Sixth, investment in science and education combined with reform. The reform in this sector has so far not yielded significant results. Only one Bulgarian university (in some years and one of the medical ones) enters the international rankings. The number of patents created by Bulgarian universities is below the European average. Investments first in science and next in education are key to the future restructuring of the Bulgarian economy into a digital one.
Seven, green transformation of the economy. As much as Bulgaria is dependent on local energy resources, which provide energy security, the world is transforming. The United States is cutting 130,000 jobs in the mining and energy industries related to fossil fuels. China has announced plans for a rapid transformation of its energy sector over the next decade. The EU is raising its targets in this area. The focus is on the risks of the pace of climate change on long-term investment. Green transformation is inevitable and Bulgaria, instead of postponing this process, should try to take a leading place in it. This will require high investments, which cannot be secured by European funding alone.
Eight, the disappearance of labor-intensive low-tech industries. The pandemic has shown that labor-intensive industries are highly dependent on national health systems, which are weak in developing countries. Such are even in transition economies. In order not to break supply chains, this type of production will be replaced by high-tech robotic processes. In this situation, the cost-benefit analysis of robotics is a plus and the high initial investment is worth it, and the development of science already allows it technically. This means investing in retraining the workforce, which will also take time. Therefore, this retraining process must start ahead of time before burdening public social spending.
The post-COVID economy will intensify, not limit, globalization. Global supply chains will become digital, greener and more technological. Anyone who relies on low cost of production resources and low level of production technologies will be excluded from them. On the contrary, high investment in science (following the example of vaccines) will be the new norm and will bring economic benefits.
20.05.2021
IN WHICH CITIES ARE THEY LOOKING FOR THE MOST WORKERS
The companies in Sofia are looking for the most staff, and for the week from May 10 to 16 768 people have been hired from the registered in the labor offices, the latest NSI data show.
Due to the beginning of the summer season, staff is also sought in Burgas and Varna, and for a week the companies have hired 639 and 520 unemployed, respectively.
The labor market is also active in Blagoevgrad and Plovdiv, where 463 and 491 people are employed, respectively, in just one week. The least workers are looking for business in Montana. Only 69 people found jobs there in mid-May and Vidin, where 99 people were hired.
A total of 6,976 Bulgarians registered with Employment Offices started work for the week of May 10-16. The newly registered unemployed are 5,661 people, according to NSI data.
Most new redundancies are in Sofia - 531 people, followed by Plovdiv - 484, Blagoevgrad - 392, Burgas - 316.
Over 200 people per week lost their jobs in Varna, Vratsa, Pazardzhik, Pleven, Ruse, Haskovo, Stara Zagora. The least redundancies have been undertaken by companies in Gabrovo - only 79 laid off.
20.05.2021
THE SERVICES OF ALL MUNICIPALITIES IN BULGARIA ARE AVAILABLE ONLINE
The services of all municipalities in Bulgaria are now available electronically through the Portal for access to electronic administrative services - https://egov.bg of the State Agency "Electronic Government", the agency announced.
All municipal administrations are affiliated to the Unified Model for ordering, paying for and receiving electronic administrative services. Every municipal service can be requested and paid for every municipality in the country.
It is necessary for the citizens to have a personal profile in "My space" on the egov.bg Portal and a qualified electronic signature. The services can be requested with both physical and mobile electronic signatures.
19.05.2021
THE EMPLOYMENT AGENCY CONTINUES TO ACCEPT DOCUMENTS ON ANTI-CRISIS EMPLOYMENT MEASURES
Consultancy Center - Berkovitsa provides summary information on the extension of a total of four measures to maintain employment, provide new employment and support families for the pandemic, implemented by the Employment Agency under the Operational Program "Human Resources Development". Additional funding provided by CMD № 182/07.05.2021 allows the measures to be implemented by the following deadlines:
The allocated additional funds amount to BGN 22 million for the preservation of 33,000 jobs in the most affected sectors "Hotels and restaurants", "Tourism" and "Transport". Documents for this measure will be submitted by 31.05.2021. So far, more than BGN 52 million have been transferred to 2,937 companies and self-insured from these sectors.
- Parents of children from 0 to 5 years of age, not enrolled in a nursery/kindergarten, as the parents have a job or employment or are self-employed/self-insured, but currently take care of their children and are not returned to work;
- Parents with many children - with three or more children under the age of 12 who have returned to work, with children attending crèches/kindergartens as well as school.
- Unemployed persons registered with the labor office who are parents of children from 0 to 5 years of age and are not registered in a crèche/kindergarten or large parents of children from 0 to 12 years of age attending a crèche/gardens as well as a school.
The allocated additional funds amount to BGN 23 million. Documents under the program will be available until May 31, 2021. Since its beginning, nearly BGN 48 million have been paid, and 7,162 parents and families have used or are currently using babysitter.
The allocated additional funds amount to BGN 25 million. Under this measure, over BGN 66 million have already been transferred for compensation and employment of 52,319 employees.
The allocated additional funds amount to BGN 50 million. So far, nearly 20,000 new jobs have been created under the measure. With the additional funds, another 11,000 jobs can be created. Under the measure, applications will be accepted until the financial resource is exhausted.
Consultancy Center - Berkovitsa reminds that until June 15, 2021 employers can apply for funds under the measure "60/40", implemented under the Council of Ministers № 151/2020, as amended with CMD № 93/2021. Under this measure, funds are paid for maintaining employment in the months of April and May 2021 to companies from almost all sectors of the economy, whose sales revenues have decreased by over 20% compared to the average revenues for 2019.
Detailed information on all measures to support and promote employment is published on the official website of the Employment Agency.
17.05.2021
REGISTERED UNEMPLOYMENT RETURNED TO PRE-COVID-19 LEVELS
6.1% [1] is the level of registered unemployment in April according to administrative statistics of the Employment Agency. The decline on an annual basis was by 2.8 percentage points - from 8.9% in April 2020, and the decrease compared to the previous month was by 0.4%.
The registered unemployed during the month were 200,417, which is 13,635 fewer than in March and 92,393 fewer than a year earlier. During the month, 21,924 new unemployed persons registered with the labor offices, a decrease of 3,255 persons compared to March this year and 65,139 compared to April 2020. Another 489 people from the groups of jobseekers employed, students and pensioners, also registered with the Employment Agency during the month.
The number of unemployed persons who started working in April was 24,502. The data from the administrative statistics of the Employment Agency show a minimal decrease of 645 in number compared to March, but almost double the increase compared to the same month of the previous year (12,953). Another 399 people from the groups of pensioners, students and employees also found their new jobs through the employment offices.
79.6% of those who started working in April are employed in the real economy, most of them employed in the manufacturing sector - 21.0%, followed by those in trade - 13.7%, hotels and restaurants - 11.3% , agriculture, forestry and fisheries - 6.9%, construction - 6.1%, general government - 5.5%, administrative and support service activities - 3.8%, human health and social work activities - 3.6%, etc.
5,003 unemployed persons from the risk groups were employed in subsidized jobs during the month - 757 under employment programs and measures and 4,246 - under schemes of the Operational Program “Human Resources Development” (OP HRD). The "Employment for you" scheme under the OP HRD, which started in July 2020 as an anti-crisis measure, has provided employment to a total of 20,450 people, and only in April employment contracts were concluded with 1,756 new unemployed.
In order to preserve employment, the anti-crisis measures for short-term employment support continued to work in April - the well-known "60/40" and the project "Short-term employment support in response to the COVID-19 pandemic" under the OP HRD. In April, more than 165,000 employees were supported under these measures. The “Keep Me” measure, funded by the OP HRD and the React-EU financial mechanism, to support employees in forced unpaid leave imposed by the suspension of a number of economic activities in order to control the COVID-19 pandemic, provided funds to nearly 52,000 busy faces.
The requested jobs on the primary labor market in April were 18,130 or 322 (1.7%) less than the previous month and over 7,900 (77.3%) more than in the same month of 2020. The largest share of vacancies Jobs in the real economy are advertised in manufacturing (25.6%), followed by hotels and restaurants (21.6%), trade, repair of motor vehicles and motorcycles (9.4%), general government (7.6%), administrative and support service activities (6.9%) ) and agriculture, forestry and fisheries (6.3%).
The most sought-after professions during the month are: staff employed in the field of personal services; machine operators of stationary machines and equipment; waste collection and related workers; workers in the mining and processing industry, construction and transport; staff caring for people; sellers; drivers of motor vehicles and mobile equipment; agricultural, forestry and fishery workers; skilled workers in the production of food, clothing, wood products and related; metallurgists, machine builders and related craftsmen, etc.
[1] The unemployment rate is defined as the share of the registered unemployed in the economically active population aged 15-64, established in the 2011 Census.
17.05.2021
ENTREPRENEURSHIP: HOW TO REGISTER A COMPANY
Most consumers have difficulty choosing the type of company to register. Each structure has its advantages and disadvantages. The most important thing is to think about the taxes you owe to the state and the responsibility you take on your partners.
Currently, EOOD or OOD is the preferred form for starting a small to medium company in Bulgaria, especially after reducing the requirement for start-up capital during registration, according to the Registry Agency.
The difference between EOOD and OOD is in the number of people owning parts of the capital. In EOOD the ownership of the capital is sole - one person is a contributor of the capital. For registration of a limited liability company - the founders must be at least two, but there is no requirement to have equal capital investments.
According to experts' calculations, the registration costs vary from BGN 110 to BGN 180, depending on whether you have an electronic signature and submit documents electronically.
If you decide to register EOOD you will need the following documents:
Note on paid-in capital, which you can issue from a bank of your choice.
Consent for acceptance of management and sample of the signature (specimen) - it is necessary to be notarized and signed by the manager. There are two options: to have a prepared specimen, which needs only notarization, or to ask the notary office to prepare it.
Founding Act
Constituent minutes - The document must contain the decisions taken by the constituent assembly and the agenda of the meeting.
Decision to appoint the sole owner of the capital as a manager
Application form A4 - the most important document! You can find it on the website of the Commercial Register, download and fill it out. All other documents are attached to it.
Declaration under Art. 13, para. 4 of the Commercial Register Act (CRA). The truth of the stated circumstances is declared. Signed by the applicant.
Declaration under Art. 13, para. 5 of the CRA. Submitted by the bearer. To be filled in only when the applicant does not present the documents in person in the CR.
Declaration under Art. 142 of the Commercial Act (CA). Prohibition of competitive activity. Signed by the manager.
Declaration under Art. 141, para. 8 of the CA. The manager declares that he meets the requirements of the law for a company manager. It is signed.
Application for keeping a company name (D1), which is not obligatory and costs BGN 50.
License or permit, when the activity of the company requires such.
If the whole process is done correctly, the company is ready and automatically receives a UIC (Unified Identification Code, the so-called BULSTAT). This is the unique 9-digit number of the company, which serves for its identification with the state institutions and bodies.
Once the company is ready to register, it is necessary to declare the start of its activities to the NRA and you can now start working.
12.05.2021
WHAT COMPANIES ARE LOOKING FOR WORKERS
The positive trend in job advertisements in all industries is preserved, as their total number already reaches the levels from before the beginning of the Covid crisis in our country, according to the current monthly analysis of the company for complex HR services JobTiger.
If we compare with the data for March 2021, the growth of job offers in April is 21%, and if we take as a starting point the situation from a year ago (April 2020), then job offers in April 2021 are by 155% more. Thus, we already have a leveling of the published job offers in Bulgaria with those from the period before the beginning of the coronavirus pandemic, the authors of the analysis comment.
After the resumption of the activity of the food and entertainment establishments and with the approach of the summer, logically, the leader in the search for new staff is the sector "Hotel and restaurant business". In it, the new job advertisements in April were almost twice as high (growth of 95%) compared to the previous month of March.
We remind you that in March the demand for staff in the industry remained unchanged compared to February, despite the imposed lockdown. The most offered positions in the sector in April were for kitchen staff and service staff (waiters).
Since the beginning of this year, the trend in new job offers in all sectors has remained permanently positive. The March 2021 lockdown did not have the devastating effect of finding new staff, as it did with the first March-April 2020 lockdown.
The reasons for this, according to the analysis, are the adaptation of business to work in the conditions of COVID-19, the restored activities of catering and entertainment facilities, the approaching tourist season and, last but not least, the continuing economic growth in a number of sectors (IT, Outsourcing, Trade and sales, etc.).
There is still an increase in ads in all sectors. After the leading sector "Hotels and restaurants" (where the number of ads has grown, as we said, almost doubled), in second place is "Trade and Sales" with 21% growth, and in third place - "Administrative activities" with 13.4% growth. They are followed by the sectors "Logistics and Transport" (growth 12.8%), "Production" (growth 10%) and "Accounting, Auditing, Finance" (growth 9%).
In terms of share distribution, the Trade and Sales sector is still in first place - with 21% of the total number of proposals published in April. As a result of its large growth, the hotel and restaurant sector moved from fourth to second place - with a 20% share of all ads.
After them, the share distribution remains, as in the previous month of March, with the sector "Production", occupying 14% of the ads, followed by the sectors "IT" (12%), "Logistics and Transport" (9.3%), "Administrative activities" (8.8%), "Construction" (5%), "Accounting, audit, finance" (4%), "Health and pharmacy" (3.2%), "Marketing and advertising" (3%) and Art (1%).
Distribution of new proposals by cities
In each of the leading regional cities the growth of the announcements in April compared to March is double-digit, as follows: Sofia - 15%; Plovdiv - 14%; Varna - 33%; Burgas - 39%; Ruse - 27% and Stara Zagora - 18%.
The number of published job vacancies for these cities is equal to 70% of job offers across the country.
The positive trend in the search for new staff in our country since the beginning of the year draws an optimistic forecast for the coming months. The expectations of the ads are expected to remain within these limits, without risks of sudden declines, the authors of the analysis predict.
11.05.2021
THE EC CONDUCTS PUBLIC CONSULTATIONS ON THE CREATION OF INDIVIDUAL TRAINING ACCOUNTS
The European Commission is holding a public consultation on the so-called individual accounts for trainings, in which services for inclusion in trainings will be accumulated and spent. They will guarantee the right to education of every citizen of the European Union. Through public consultations, the EC is trying to answer the question "Can individual training accounts ensure that adults continue to build the skills they need, regardless of their employment status?"
Until 16 July, any organization or citizen of the European Union can give feedback on the definition of the problem and the need for further action at EU level. Anyone who wants to get involved can fill out the survey on the European Commission's website or send an opinion on the matter.
The topic of individual training accounts is particularly relevant after the outbreak of the COVID-19 pandemic, the digital and green transitions that have caused significant structural changes in the labor market and will radically change the skills requirements for many jobs. This increases the need to build skills throughout life. At the same time, the number of people involved in atypical forms of employment (part-time, temporary employment, self-employed, etc.) who are at risk of insufficient support for training by employers is increasing.
10.05.2021
MEASURES TO SUPPORT EMPLOYMENT AND PAY COMPENSATION CONTINUE
Explanation from the Consultancy Center - Berkovitsa
In the conditions of slow economic recovery and continuing emergency epidemic situation, the measures to support business and to preserve the employment of employees of enterprises that have stopped working, work part-time and have reduced sales revenues have been extended.
Support for the “60 to 40” measure continues. For this purpose, amendments to Decree № 151 of the Council of Ministers of 2020 were adopted to extend the term for payment of funds for maintaining the employment of employees from 01.04. until 31.05.2021 (CMD № 93 of 18.03.2021, promulgated SG, issue 24 of 23.03.2021). The funds will continue to be paid for employees who during the period from 13.03. until 31.12.2020 they worked part-time on the grounds of Art. 138a, para. 2 of the Labor Code (LC) or have used leave on the grounds of Art. 173a of the Labor Code, as well as for workers and employees, whose work has been suspended by an order under Art. 120c of the LC.
For this purpose, the employees should have been in an employment relationship with the employer before 01.10.2020. During the additional period of application of the measure, the employers who received funds for maintaining the employment of the employees from the groups under the decree will pay amount not less than the amount of the insurance income for October 2020, and will pay the due insurance contributions for the respective month.
A favorable change has been made for the business, and employers who have proven a decrease in sales revenues in the month preceding the month of application by at least 20 percent, but compared to the average revenues for 2019 - the year before the pandemic, when they had normal turnovers and revenues, and compared to them in 2021, it is very possible that they will have a decrease, which, in turn, will entitle them to receive funds under the decree. A comparison with the previous 2020 would not be in the interest of business.
Assistance under the “Keep Me” measure was also extended by three months. For this purpose, amendments to the Decree № 325 of the Council of Ministers for determining the conditions and the procedure for payment of compensations to workers and employees insured in economic activities, for which temporary restrictions have been imposed by a state body for their implementation during the period of the declared state of emergency or declared extraordinary epidemic situation.
The main changes provide for individuals to be entitled to compensation for no more than 60 days within 2020 and no more than 90 days within 2021 in which they have used unpaid leave in connection with imposed restrictions on the implementation of the activity, for which they are employed, in an act of a state body. The term of application of the measure is increased - until 30.06.2021. The changes are in force from 01.04.2021.
Persons are allowed to participate under the measure "Keep Me" only if they are employed in sectors that fall within the approved by the Minister of Labor and Social Policy List of codes of economic activities for which temporary restrictions have been introduced for carrying out activities with an act of a state body in the period of a declared state of emergency or a declared state of emergency epidemic, by a decision of the National Assembly or the Council of Ministers. The current order with the list of codes is published on the website of the Employment Agency, at:
https://www.az.government.bg/pages/zapazi-me/.
Employees should be on unpaid leave under Art. 160, para. 1 LC or Art. 173a, para. 2 of the Labor Code due to introduced temporary restrictions for carrying out the activity, specified in an act of a state body.
The Council of Ministers also adopted changes in Decision № 429 of 26.06.2020 on determining the terms and conditions for payment of compensations to self-insured persons and employers in order to maintain the employment of employees in enterprises directly affected by the state of emergency, declared with a decision of the National Assembly of 13.03.2020, amended and ext. with Decision № 982 of the Council of Ministers of 31.12.2020. The changes were adopted by Decision № 233 of the Council of Ministers of 18.03.2021. The aim is to continue the additional support for the most affected sectors and economic activities and to preserve the employment of workers. and the employees falling into them.
In line with the measure "60 to 40" the deadline for payment of funds was extended until 31.05.2021. The changes also provide for the payment of funds to be able to apply to employers who have proven a decrease in sales revenue in the month preceding the month of application, with not less than 20 per cent compared to the average income for 2019 for the established persons before June 1, 2019 and those established for the period from 01.06. until 01.12.2019. For those established during the period 01.12.2019 until 01.03.2020 and those after 01.03.2020 - compared to the average revenues for 2020. This also applies to municipal activities.
For self-employed persons - registered as freelancers and/or craftsmen, as well as persons engaged in employment as sole traders in certain sectors, and who have declared a decrease in sales revenue, the requirements are as follows:
Due to the repeated imposition of temporary restrictive measures for carrying out activities in the sectors falling within the scope of Decision № 429 of the Council of Ministers, it is possible to receive funds for persons employed by the employer or registered as self-employed after 13.03.2020. This approach is also in line with the Council of Ministers № 151/2020, where restrictions on new employees are also not included for employees employed in the transport and hotel and restaurant sectors.
Additional and up-to-date information, answers to frequently asked questions, as well as lists of approved and disapproved employers are published daily on the website of the Employment Agency, at:
https://www.az.government.bg/pages/finansovi-stimuli-za-zapazvane-na-zaetostta/.
07.05.2021
108,600 NEW UNEMPLOYED FROM THE BEGINNING OF THE YEAR TO MAY
Nearly 108,600 are newly registered unemployed across the country from the beginning of the year to May 2, according to the latest data from specialized labor market surveillance carried out by the National Statistical Institute and the Employment Agency over the Covid-19 pandemic.
For the same period, 83,400 people started working through the Labor Offices. The highest number of newly registered unemployed so far was reported between January 4 and 10 - over 15,700 with only 3,300 employed.
In 15 districts, the newly registered unemployed are more than those who started working in the last observed week from April 26 to May 2. This difference is strongly expressed in Montana, Vidin and Plovdiv.
During this period, the total number of people registered in the Labor Offices in the whole country is 3776, and the number of employed is a little over 4,000.
In general, the trend of predominance, albeit with several hundred people across the country, of those who have found a livelihood over those registered in the labor offices, has been going on for exactly one month now.
Social experts attribute this to the ongoing action of measures such as 60 to 40 to maintain employment, alleviate anti-epidemic measures and especially the opening of shops and restaurants, as well as subsidized employment.
