Bulgaria: Latest working life developments – Q1 2017
Rising wages following an increase in the minimum statutory wage, a victory for the centre-right party GERB in the March elections and predictions of a rise in employment in tourism are the main topics of interest in this article. This country update reports on the latest developments in working life in Bulgaria in the first quarter of 2017.
The minimum statutory wage increased to BGN 460 per month (€234 as at 18 April 2017) from 1 January, compared with BGN 420 per month (€214) in 2016. According to Regulation No. 22 of the Council of Ministers of 26 January 2017, the new rate is to be paid for full-time work (an eight-hour day and a five-day week).
According to data from the National Statistical Institute (NSI), the gross monthly average wage (PDF) reached BGN 1,012 (€515) in December 2016. This was an increase from BGN 974 (€496) in November and BGN 982 (€500) in October.
Compared with the fourth quarter of 2015, the average monthly wages and salaries in the fourth quarter of 2016 increased by 8.2%. The highest growth rates were recorded in the following economic activities:
- arts, entertainment and recreation (21.6%);
- wholesale and retail trade, repair of motor vehicles and motorcycles (12.9%);
- information and communication (9.7%).
Public sector wages and salaries rose by 5.1%, while those in the private sector grew by 9.4%. The highest wages are paid in the information and communication technology sector (BGN 2,248 or €1,145), followed by electricity, gas, steam and air conditioning supply (BGN 1,757 or €895) and financial and insurance activities (BGN 1,699 or €866). The lowest wages are in accommodation and food service activities (BGN 600 or €305).
Economists expect the average monthly wage to increase to BGN 1,039 (€529) in 2017 and to BGN 1,125 (€573) in 2018. Analysts forecast that the economy will grow by 3.6%. The main engine of growth will be internal demand and individual consumption.
Plea for renewal of social dialogue
Bulgarian President Rumen Radev met with representatives of the Confederation of Independent Trade Unions in Bulgaria (CITUB) and of the Confederation of Labour Podkrepa (CL Podkrepa) on 27 February after the unions asked him for help in renewing social dialogue with the employer organisations.
The unions said that they were relying on the President to ‘support them in the reinstatement of the damaged dialogue with employer organisations’. The unions said employer–union relations in tripartite dialogue are stagnating, prompted by disagreements on the minimum working wage and on social security thresholds. The employer organisations have not yet reacted.
The other topic during the meeting was the unions’ belief that the constitution must guarantee workers’ right of association and collective bargaining. CITUB President Plamen Dimitrov said this would enable workers and employees to negotiate for their salaries without fear that they could be dismissed.
Centre-right party takes 97 seats in parliamentary elections
- 33.54% of votes for the centre-right party Citizens for European Development of Bulgaria (GERB) – 97 seats out of 240 in the National Assembly;
- 27.93% for the Bulgarian Socialist Party (BSP) (81 seats);
- 9.31% for the coalition of nationalist forces United Patriots (28 seats);
- 9.24% for the Movement for Rights and Freedoms (DPS), representing Bulgarian Turks and Muslims (21 seats);
- 4.26% for the new right-wing populist party Volya, created by Bulgarian businessman Veselin Mareshki (13 seats).
GERB leader and former Prime Minister Boyko Borissov is heading the negotiating team for the talks on a future coalition government which are expected to last till the end of April.
Hospitality jobs set to rise as tourism soars
Seasonal employment in the hospitality sector is expected to rise, after data from NSI showed a sharp rise in tourism in January and February 2017. NSI said visits by foreign tourists to Bulgaria increased by 18.6% compared with the same period in 2016. This also showed that the total number of overnight stays for 2016 was 25.2 million, a rise of 17.7% from the previous year. The highest increase, of 21.0%, was in four-and five-star hotels.