Bulgaria’s Advantages – Low-Cost Labor Force
In the course of our major topic concerning Bulgaria’s most distinct relative advantages over the rest European states we reach arguably the most important factor in the overall concept of the post-communist economic development of the country – employment and labor force. Their most essential characteristic features involve two grand aspects representing two indisputable advantages of Bulgaria – economic and educational. Due to the key importance of each one of them we have decided to pay special attention to the two aspects reviewing them separately in two different theme articles.
Economic aspects of Bulgaria’s employment – “Low-Cost Labor Force”:
When speaking of the labor force needed for the proper functioning of every business project (production of goods, providing services, transportation, etc.), the first and major question before every entrepreneur is “How much does hiring one employee cost?” In Bulgaria the answer to this key question cannot sound more attractive to every potential investor.
Fact: Extremely low labor force prices are inextricably bound to low employment costs.
The minimal monthly remuneration in Bulgaria is BGN 310.00 which is equal to about EUR 160.00 – the lowest in the entire European Union. This turned out to be quite a stimulus not only to the foreign investors, but also to the local entrepreneurs who considered the business-start-up barrier not rather high. Practically, potential entrepreneurs are only required to develop a logical and applicable scheme, build up efficient relations in their business project and find not-that-large financing. In cases of foreign investments we witness the realization of extremely large-scale initial labor force investments avoiding the unnecessary loss of time and energy in executing preliminary precautious steps on the employment market, probably on many occasions due to the unusually low for Europe costs in this segment. Notwithstanding the fact that Bulgaria is still expecting real large foreign investors, we cannot ignore the indisputable truth that most of the economy and its growth are based particularly on cash in-flows from abroad.
The above stated facts illustrate that even located in Europe’s periphery, Bulgaria can count on a serious advantage which might turn it into an important factor and accelerate its economic development, thus building-up an economy based on much more than just the low value of certain investment factors. This process is long in time and not necessarily smooth due to the social price it incurs, but represents the only one possible way towards prosperous market economy and higher living standard. The resolution to this difficult task involves Bulgaria taking vantage of all its advantages (including the current low-cost labor force) in an effort to catch up and be compatible in the present seriously competitive global economic life.