Reporters of bTV: The Pulse of the Industry
It is expected that in the coming years the region of Plovdiv will concentrate mainly high – tech companies.
Contrary to the popular opinion that nothing is being produced in Bulgaria, factories around Plovdiv are multiplying. Hence auto parts, lighting fixtures, refrigerators, lifts are manufactured there and go to all of Europe and the world.
In a highly controlled environment, one factory produces high-tech sensors without which a modern car could not actually move. Even if just a dust has fallen on the boards before them being sealed, it could cause damage.
In Bulgaria is located the third largest production of this company after Mexico and China.
“Currently about 3000 thousand people work in Bulgaria. One reason to be here, of course, is profitability – every company is looking for it. But when you ask me if we are here only because of the “cheap labor” – no, I mean that we see a lot of people with technical knowledge in Bulgaria and this is a big advantage,” said Tommy Vert Elst – general manager in a company for auto parts.
The more factories they open, however, the harder they are to find and retain the qualified personnel.
“There are about 72,000 people employed in this sector of the economy and that’s more than Sofia, more than Varna and Bourgas combined and more than any other region of Bulgaria,” said economic observer Georgi Stoev.
Each year between 3000 and 5,000 new employees are sought in the area.
Unemployment in Plovdiv is already among the lowest in the country, and in the region its generally even less than Sofia.
“More and more entrepreneurs and managers think strategically for the labor market, i.e., they do not intend to open 400 new jobs and steal them from an existing manufacturer. They know that if they offer 400 jobs, every year 40 people leave, therefore, they have to start preparing those 40 while making the first sod of the factory, “added Georgi Stoev.
One of the oldest zinc and lead factories started to think about it 10 years ago and almost “adopted” one of the professional high schools in Assenovgrad – they have started to sponsor 4 out of 6 classes according to what specialists they need.
“We are in a way “raising” our staff, as we all knew about the problem with lack of employees, of course we reacted proactively and many years ago we decided that we would work on this issue. Students after the 11th grade join us for a summer placement then throughout 12th grade their practice takes place with us. This is a natural filter for those who want to stay at work. Of the 12-13 children who come to work in the summer, between 60-70% remain on permanent work,” said Rositsa Temizova, Head of Human Resource Development.
Alexandra Angelova is one of them. She is now 25, and now holds a master’s degree in chemistry.
“I test water, soils and dust samples for different performance indicators of the factory. I started on a placement here in the lab, then I was offered a permanent place and it has been almost six years. In the meantime, I also completed my degree in chemistry. There are many young people who are not oriented and do not know what they want in life, I believe if they are given a chance in real conditions, they may find it easier to decide what they want to do in the future”, said Alexandra.
Foreign investors also look at vocational high schools and universities.
“If you come with the attitude “I want to only hire people ready to start work right away”, then you do not come with the right attitude in a developing economy like Bulgaria. The industry should work closely with universities and the education system to ensure, so to speak, the development of future talents”, said Tommy Ver Elst, General Manager of an auto parts company.
The more specific the employee’s profile is, the more time it takes to find him. In this case, finding the right person can take up to 2 months, they say in this company.
In another factory, they see that even with the less skilled staff, it is no longer that easy. For example, a Swedish-Swiss company near Rakovski employs more than 1,600 people.
“There are certainly difficulties finding the people we need. That is why we are doing internal trainings, both with other companies here and with our other factories, especially in Germany and Italy,“ said Uwe Chirner, Manufacturing Manager in Rakovski.
So, after 1 year of training, 23-year-old Vladimir Alvadziev is already one of the valuable employees – among the few who work on a production-specific machine.
“I was getting a salary and the training itself was paid by the companies. I got to know the actual machines, as we do not have access to the machines at school, getting to work with them helps me a lot,” said Vladimir.
He graduated from the Professional High School of Electronics and Electrical Engineering in Plovdiv. For nearly 4 years, every day he commutes 40 minutes to work in the nearby village of Stryama. He hopes he will not have to go abroad, unlike many of his classmates.
“Most of them are looking for development outside of the country because of better pay and better work conditions. It is that not all companies can provide stability, pay a good salary, and as well adequately treat the employee himself, as a person, and not as an object that only does a certain job”, Vladimir said.
Analysts say the situation is improving.
“For the last 3 years, the salary growth is about 30% and this together with the Rousse region is probably the fastest in the country. In the industry, wages are growing faster than in the services sectors, even though the two are linked – when purchasing power grows, people start to give more money for rents and services,” explained Georgi Stoev.
Recent data from the national statistics are for 2015. They show that the average salary in the region of Plovdiv is 757 leva. According to analysts, this is now closer to the lowest remuneration in manufacturing.
“Recently, it is often noted that if medium or large companies enter the country for the first time and want to find people faster, they tend to offer between 10-20% above the average wages for the particular sector. Then things get much easier, “ said Deputy Mayor of Plovdiv Stefan Stoyanov.
“At present, what a worker gets for himself is between 800-1000-1200 leva, depending on his qualification. If they have a good qualification, people get a good salary, the problem is when we have uneducated people, they cannot get a good wage,” said Plamen Panchev.
Compared to Sofia, however, salaries remain significantly lower.
Peter Kirov moved from Botevgrad to Plovdiv 4 years ago. When he started at the elevator company, he could only work on one of the machines. Now his colleagues call him the “Swiss knife” man – he can manage each of the machines and as well weld. That’s how he already heads the entire team.
“I decided that I had to develop professionally somehow, and in Botevgrad it was not possible to do that. That’s why I came here. I came by train, and now I’m traveling with my Mercedes. In fact, there are several people in Botevgrad working in our company – and they have not gone to Sofia,” Peter said.
Of the 20 employees, three are from Botevgrad, one from Chirpan, the other are from Plovdiv and the region.
“We always try to pay enough for people to feel good and stable, to be able to grow their families. For some a lot of money is not enough, for others a little money is a lot,“ commented the manager of the elevator company Damyan Petrov.
Some of the employers in the Plovdiv region are already looking for employees in Northwest Bulgaria, where unemployment in places is over 50%.
“This is an opportunity for both the people and the companies. On the one hand, people see another chance to work in Bulgaria, an alternative to going abroad or working a less qualified job, and companies on the other hand, can find more and better workers,” stated Deputy Mayor of Plovdiv Stefan Stoyanov.
They also hope that at least part of the Bulgarians studying abroad will follow the example of Atanas. Two years ago, he came back from England to apply the lessons he learned there to his native land. He is responsible for sales in a company that exports over 90% of the vast beer, milk and wine containers it produces.
“Generally, my dream has always been to live and progress in here. My goal in England was to learn, but I always wanted to develop in Bulgaria,” said Atanas Chilingirov.
The Fourth Industrial Revolution will leave its footprint on Bulgaria. It is expected that the region will attract mostly high-tech companies, and this will change the rules of the game – fewer, but more skilled people, along with computers and robots, will produce more.
“Investors who really rely on the large number of people at an affordable cost of labor will have to head to other industrial zones, while here the focus will shift to investors with higher-tech factories, that have a higher added value per employee, and respectively are willing to pay higher salaries,” said Georgi Stoev.
For this purpose, the training of specialists in the coming years will have to respond directly to the needs of the business. In order to stop the “brain drain”, good enough conditions will have to be offered.
Currently, in the professional high schools there are about 30,000 young people who have to be convinced that there is a prospect of a good career if they stay at home, and that is not a mild task.
Alexandra has found a job thanks to meeting her employer in school, but half of her other classmates have left the country. Of the 22 graduates in the same class, 10 are abroad.
“They have seen another way of life, so I do not think they can come back. But we have to work so others do not have to leave anymore – I would not quit, because I want to achieve something here, if we all just go somewhere else – nothing will change,” said Alexandra Angelova.
Foreign companies in Bulgaria are also looking for security. Therefore, they are sensitive to sudden changes in the environment in which they operate. The change of governments does not bother them, as long as it does not lead to drastic changes in the tax system. The truth is that when companies invest tens of millions of dollars in a factory in Bulgaria, they are looking at least 20-30 years ahead in the future.
