Eastern Europe's Shrinking Workforce: The Foreign Fix?
A study by professional services firm PwC Romania, commissioned by the American Chamber of Commerce in Chisinau, reveals a trend in Eastern Europe, including Moldova, of hiring foreign workers to address labour shortages.
The report indicates a growing need for workers from countries like India to supplement the domestic workforce.
Moldovan authorities are implementing measures to encourage citizens to work domestically. One key initiative is a mandate for transparent employee salaries, aligning with a European Union directive.
The actual labour shortage is significantly higher than official statistics suggest. This is due in part to a third of the country's working-age population being abroad and a high employee turnover rate, with workers frequently switching jobs.
"Employee behaviour in the labour market is another factor contributing to the shortage," said expert Oana Munteanu. "The high turnover rate, with employees frequently switching jobs, means the actual labour shortage is more severe than what the statistics show."
Munteanu highlights India's growing and well-educated young population as a potential solution. "By attracting workers from countries in the East, where populations are growing rapidly, Moldova can address this competitive disadvantage," she remarked.
To overcome the labour shortage, the Ministry of Labor and Social Protection, led by State Secretary Corina Ajder, is continuing its focus on transparent wages. Ajder also emphasised programs to legalise undocumented workers, particularly prevalent in agriculture, where the informal labour rate remains high at around 60%.
"In just a few months, we have over 500 cases of undeclared work, and around 70% have been legalised," said Ajder. "Our goal is to reach at least a thousand legalised workers this year. We are also developing incentives for businesses in this sector."
A digital registry for day labourers and a voucher system to simplify the declaration process for occasional workers are additional initiatives planned for this summer.
Moldova's working-age population has shrunk by an average of 40,000 people annually over the past nine years, further exacerbating the labour shortage.
Translation by Iurie Tataru
