Huge shortage of skilled workers slows development in new EU countries

In the booming economies of the new EU Member States there is a shortage of skilled workers in all industrial sectors from the building industry to the health sector. This shortage is becoming more acute and is slowing down economic development in Eastern Europe.

Workers from Kazakhstan, Vietnam and China

According to Peter Havlik, deputy director of the Vienna Institute for International Economic Studies, the huge shortage of skilled workers is having a negative effect on economic development in the new EU Member States. Workers are already being recruited from Kazakhstan, Vietnam and China. The increasing shortage is one of the greatest challenges for these new EU Member States.

Building industry most heavily hit

As in Austria, construction workers, architects and engineers are in heavy demand, says Havlik. In Bulgaria there is a shortage in particular of IT specialists, waiters and chefs; Poland needs doctors, welders and mechanics; Romania has an urgent need of textile workers and is even recruiting women from China; in Slovakia and Hungary the shortage mainly concerns electrical, mechanical and automotive engineers. Throughout Eastern Europe the building industry is most heavily hit. Construction is booming and the industry in the last two years has been growing three times as fast as the economy in general. In Bulgaria the number of jobs has doubled in a single year and Poland has not been able to use all of the available EU subsidies for modernising the roads because of a shortage of labourers.

Bonuses for returning workers

In some Eastern European countries the shortage of skilled workers is so acute and serious that governments have decided to pay bonuses to motivate labourers to return from abroad. Romania is particularly affected: it has more than two million citizens living and working abroad, including many skilled workers. The government in Bucharest is writing to emigrant skilled workers informing them that they can earn much more in Romania than used to be the case. According to Havlik wages and salaries in Romania have indeed increased considerably – by almost 20 per cent in the building industry, for example – and will continue to do so to a greater extent than in the other new EU Member States.

Immigrant skilled workers an economic factor

Skilled workers from Eastern Europe have already become an important economic factor in the EU. According to a study by the British Home Office, between 2001 and 2005 immigrant workers accounted for almost one fifth of the UK’s economic growth. By the same token, emigration is slowing the economic development in the new EU Member States. They remain competitive for the time being, but wages there are only 35 to 45 per cent of the levels in Austria. Havlik nevertheless wonders how countries with an acute shortage of skilled labourers like Austria and Germany will be able to attract manpower on a large scale in the future, as emigration has become much less attractive in these countries.

Link-Tipp

Institute for International Economic Studies

Further information:
Struggle for skilled workers in the EU intensifies
Lack of skilled workers hampers economic development in Eastern Europe