Linas Jegelevičius for the BNN
Hiring has perhaps never been harder for Lithuanian employers as it is now. Raising wages isn’t enough to win the war for talent and, frankly, even hire a sweeper.
«It is definitely one of the biggest – if not the biggest – headache I have now,» Juozas Motiejauskas, a successful entrepreneur in the Kretinga district, told BNN.
Echoing, a restaurateur in the Lithuanian gem resort of Palanga, admitted he struggled «horribly» with assembling a team for past summer season.
«The pandemic has dramatically changed everything. Aware of possible new lockdown restrictions, many bar people and servers just left the sector and do not even look back at it. To patch up the gap in workforce, I had to rely on help of my own family members and myself. Frankly, I could not even find a dishwasher, although I was offering 60 euros per day,» the businessman told BNN, asking not to mention his name.
As pandemic restrictions eased amid the accessibility of Covid-19 vaccines and businesses started bouncing back, many Lithuanian employers faced – and are still facing – severe workforce shortages.
Workers who may have lost their jobs during the peak of the pandemic were now highly desired, but they are just gone.
The Lithuanian government has introduced the monthly jobseeker’s allowance of 212 euros to help the unemployed survive the quarantine. The government has also offered subsidies to cover pay for furloughed workers.
Some employers argue that the allowance, which is equivalent to a third of the minimum wage, at 642 euros now, is too generous and discourages people from work.
In early October, there were a record-high 64 000 thousand job vacancies in Lithuania in September.
«If there are so many vacancies and nobody wants to fill them, it is very hard for businesses to operate,» Dalia Matukienė, chairwoman of the Small and Medium-sized Business Council, says.
«After the period of Covid-19-caused shutdown, businesses now have opportunities to resume their operations, but there are no people to work, since they prefer to register with the Occupancy (Employment) Service and get money from the state.»
According to her, some prefer to take up unofficial jobs in order not to lose the benefits.
Vidmantas Janulevičius, a member of the Council and president of the Lithuanian Confederation of Industrialists (LCI), called the situation in the labour market «paradoxical».
«We have over 60 thousand vacant jobs when we have 112 thousand unemployed people, including 68 thousand structural unemployed people who cannot find a job for a very long time,» Janulevičius said.
He says that attracting foreign investors and offering them tax exemptions in Lithuania would alleviate the situation.
LCI has proposed deferring corporate tax payments for firms investing in high technology, robotisation and automation.
Unemployment in age group of 15-24 stood out especially painfully in September, at a chunky 19.4 percent.
Notably, there was an increasing number of long-term jobless people, approximately 40 thousand.
Counteracting that, companies of all sizes are trying to attract workers with an increased pay.
However, just jacking pay up alone won’t be enough for businesses to compete for workers in this challenging environment – the marketplace is now defined not only by the ongoing COVID-19 crisis, but also by vast possibilities of remote work and the state’s cushy subsidies for the unemployed.
«As far as the people registered in the country‘s Occupancy service are concerned, only roughly 50 percent of them receive some kind of social allowances – be it an unemployment benefit, or a social benefit. All the others receive nothing (from the Service), meaning that they got registered with it only because of the cushy 200-euro COVID-19 allowances we were paying during the first wave of quarantine, or because of some other social payouts they are eligible for,» Lithuania‘s Social Security and Labour minister Monika Navickienė said earlier this months.
She says persons with no jobs should be incentivised to go back to the labour market – even with unpopular measures.
«Ant those who malignantly take advantage of the benefits of our social care and get registered with the Occupancy Service for the only reason – get a benefit, should be prevented from enjoying them in the scope they are doing now,» the minister emphasised.
The Ministry mulls amendments to the existing laws, which, if implemented, would change the pretty generous social welfare system significantly.
For example, the ministry seeks that a jobseeker offered a job paying the minimum, or the average Lithuanian wage, would lose the unemployment benefits if he or she rejects the offer without a justified reason, which would be few such.
But some worker representatives argue that employers are simply reluctant to offer attractive work conditions and pay.
Grappling with workforce depletion, the Lithuanian Business Council, a business body, has recently urged the government to allow more migrant workers from outside the EU into the country, saying that would be justifiable and reasonable amid the worker depletion.
Meanwhile, representatives of the Investors’ Forum, seek the possibility to hire workers from other countries more easily. Businessmen would also want funds from the European recovery fund to be earmarked not only to small businesses but also to medium and large companies.
Minister Navickienė says the state should make up its mind what migration policy it will pursue and whether it will continue being a country of cheap imported labour force or has the ambition of maintaining the creation of added-value jobs and facilitate the arrival of qualified workers from third countries. Lithuania already stands out in the whole region, she points out.
«Compared to Estonia where 1,300 non-qualified workers from third countries arrive a year, Lithuania allows 30,000 drivers to enter its transport sector alone. We stand out in the whole region specifically in terms of low-qualification workforce from third countries,» the minister said.
BNN ANALYSES | Workforce depletion grips Lithuania, while job available to every second jobseeker
Linas Jegelevičius for the BNN