The employment deficit continue to hit the textile industry in Romania

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September 11, 2017

The employment deficit continue to hit the textile industry in Romania

The textile industry in Romania is marked by a paradox: although for several years it is in the top of the industries that have the most vacancies in the Romanian economy, yet the garments factories have not escaped the issue of the labor shortage.

The availability of an increasing number of jobs in the textile industry has the following explanation: the high fluctuation of employees. This phenomenon contributes, on the one hand, to heavy labor conditions and low wages, which cause some employees to quit shortly after employment. On the other hand, employees give up workers because they do not come to work, absenteeism being an acute problem faced by many light industry companies. More and more employers are offering employees involved in bonus work production to motivate them to come to work every day. Absentetism is a particularly serious problem, which is why Alison Hayes, the largest textile producer in Romania, stops working at the factory in Urziceni.

As far as companies are concerned, they now need to employ over 1,200 people. Overall, the textile industry offers over 11% of all jobs available in the country (2,450 seats out of 21,000), according to A.N.O.F.M. (National Agency for Employment). In addition to unskilled workers, 753 assorted textile apparel manufacturers and 490 clothing confectioners are recruited.

Many of those who qualify for lightweight jobs refuse to engage in this field because they know the hard working conditions in the factories: high workload, over-work, minimum wage salaries in the economy. Most of the time, these people do not have many options when they refuse to work in the factory: either they go to work abroad or work with the day or work in their own household without being insured.

In December of the previous year, the monthly net average monthly wage in Romania was almost 1,700 lei, but the wage average is not a representative indicator for an area where the difference between the lowest and the highest wage is very high. As I said above, the textile industry in this country is going through difficult moments because of: the lack of skilled labor, the non-involvement of the Government through measures to be applied, the volatility of international markets (we are talking mainly about the markets in the UK, Italy). As the industry relies heavily on assembly-type production, companies in the industry get a small profit margin. This is happening in the conditions that until last year, light industry brings the country the most money from exports, being the second, after the automotive industry. The decadence of the textile industry and its focus on assembled production has been triggered by the post-communist era: the disappearance of traditional export markets in the communist era, the decline of the Romanian industry since 1990, geographic proximity to the EU market, and the investment effort of technological adaptation.

After so many years, production focused on product assemblage is the main activity of companies in all industrial fields, which allowed the industry to survive, but not its development.

Currently, garment companies can only survive if they manage to invest in state-of-the-art technologies. The competition between Romania and other countries is due to the quality of the assembly and the price. Now Romania is fighting with Asian countries (where labor force is very cheap), countries like Turkey or the Balkan-Mediterranean region. Under these circumstances, the country has gained its first quality assemble identity and has managed to become competitive and recognized in the foreign markets.

The erroneous image of professional school (the ugly relative of Romanian education) also plays an important role in deepening the labor gap. The preconceived idea that vocational school is for the weakest children has made parents and students perceive this profession as shameful.

At the level of all industries, the country is in direct competition for the labor force with the whole of Europe, being the number one worker on the mainland on the continent. Vacancies are hard to fill because there are no qualified people. Romania proves to be incapable of attracting talent and the employability of new graduates is precarious.

An equally big problem is the salary increases of the public sector. According to the National Prognosis Commission, it is estimated that in 2020 the Romanian state will hold 47,000 more employees than it currently has. These wage increases only put pressure on Romanian companies that are unable to sustain similar salary increases from the pace of sales. Perspectives are not at all encouraging: being forced by circumstances to remain in business, companies operating in the private sector will have to raise wages, but also prices. Which means rising inflation. These steadily rising prices will make some players uncompetitive, so there will be no wonder that the number of insolvencies will increase this fall.

However, according to entrepreneurs from the Romanian Business Leaders, salary increases in the economy and in the budgetary area do not affect as long as they are sustainable and they are based on well-defined objective criteria, in correspondence with the performance of the employees.

Sources:
http://adevarul.ro/economie/bani/fruntasi-deficitul-forta-munca-angajatorii-gandesc-aduca-muncitori-dinrepublica-moldova-rezolva-criza-romania-1_595264aa5ab6550cb892f7d3/index.html
http://economie.hotnews.ro/stiri-companii-21858000-analiza-industria-textila-istorie-probleme-stradanii.htm
http://www.economica.net/cele-mai-multe-locuri-de-munca-vacante-astazi-in-romania-sunt-pentru-muncitori-necalificati-in-fabrici-de-confectii_134428.html
 
 

 



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