Increased investment in the east, emigration, a poor distribution of skills and low mobility have combined to create a growing shortage of skilled labor from Poland to Bulgaria. Investors in the region are finding they have to look much further east for staff or pay more.

In Cluj (Kolozs), in Romania’s Transylvania (Erdély) region, developers say the city’s construction boom is being held back. „The lack of skilled workers is, today, a major problem for our builders,” says Sorin Nicolescu, head of the property development division of local banking group Imofinance. He has brought in workers from Moldova, but wages have still risen 20-50% in the past year, he says.

The formerly communist states of central Europe received a total of €32.5 billion in foreign direct investment in 2006, fuelling demand for skilled workers. At the same time, thousands of Poles and Romanians, often those with the best qualifications, have emigrated to western Europe, lured mainly by higher wages. Unemployment in the new member states is relatively high – 13% in Poland – yet companies, from the construction sector to computing struggle to recruit.

Many of the unemployed, especially those over 50 or from rural areas, lack marketable qualifications. Unwillingness to move to find work is also a factor. Hungarians and Czechs have not emigrated in large numbers but both countries are suffering localized labor shortages, while unemployment is high in others areas. „The lack of labor mobility is a fact,” said Ferenc Vissi, head of human resources for Hungarian truck maker Rába. „It’s part of the culture of the Hungarian population that they don’t like to move.”

Rába tried to solve a labor shortage by relocating the jobless from Miskolc in eastern Hungary, where unemployment is12%, to its base in Győr in the west, where unemployment is 4.3%. But the effort foundered because many workers quit and went home. Jan Havelka, the former head of CzechInvest, the government investment agency, says lack of labor mobility within the Czech Republic is a problem for foreign investors. „Sometimes it comes as a shock to investors who set up a new production site and find it very difficult to get people to move,” he says.

Across the region inward investment has outpaced the ability of education and vocational training systems to produce enough workers to satisfy the market. J.W. Construction, one of Poland’s largest development companies, arranged for 200 workers to come from Uzbekistan and Tajikistanin May and is interested in importing Chinese workers. „We are planning more projects in the future,” says spokesman Jacek Bazan. „If we want to build we will have to find more foreign workers, whether from China or from the former Soviet Union.”

Wear, a Swiss-owned textile maker, employs more than 800 Chinese workers at Bacau, eastern Romania. But economists such as Zdenko Stefanides of VUB bank in Slovakia warn that eastern Europe’s labor crunch could endanger growth. Up to now, that growth has been anchored by foreign investment drawn by low wages. But if the scramble for skilled workers pushes wages up faster than employers can make productivity gains, the region could lose some of its appeal. (novinite.com)