Expert Forecasts Up to 15% Wage Growth in Bulgaria’s Low-Paid Sectors This Year

The number of work permits issued by the Employment Agency for foreign workers continues to grow, with projections for this year reaching around 40,000, according to Nikolay Nikolov from the Bulgarian Association for People Management and the Bulgarian Confederation for Employment.

Foreign labor primarily comes from two regions, depending on the industry. One group arrives from former Soviet and Central Asian countries, attracted not only by comparatively low incomes back home but also by the absence of a language barrier. The other group hails from Nepal, India, and Sri Lanka, as Nikolov explained.

Bulgaria’s workforce is steadily shrinking, currently staying below 3 million people. Nikolov noted that there simply aren't enough people available, adding that many inactive individuals on the labor market have other income sources and thus do not seek employment.

As the tourist season began, the most pressing demand for workers has been in the tourism, hotel, and restaurant sectors, which face a significant shortage. However, Nikolov emphasized that this is not a crisis but a challenge businesses have adapted to by better planning. Other sectors also struggling to find staff include warehousing, logistics, and various manufacturing industries.

Nikolov highlighted a growing trend of rising wages at the lower end of the pay scale. Young entrants to the labor market tend to have high salary expectations, forcing employers to raise salaries in these lower brackets. Meanwhile, wages in the higher ranges remain relatively stagnant, creating a wage disparity.

The expert pointed out that rising costs across the board, including for human labor, are pushing prices higher. He predicts that by the end of the year, salaries in the lower wage zones will increase by at least 15%, a development that will also influence inflation.

Joining the eurozone is expected to further drive demands for higher pay from workers. While Bulgaria has a well-established culture of bonuses and benefits, Nikolov cautioned that these are often the first expenses companies cut during economic downturns.

Looking ahead, he expressed that it may take another 10 to 15 years for Bulgaria’s living standards to approach the European average.

Source: BNR interview