RADOSVET RADEV: THE PEAK OF THE LABOUR SHORTAGE WILL COME IN 2020

Radosvet Radev has been the executive chairman of the Bulgarian Industrial Association (BIA) since June 2018. He had been a deputy board chairman of BIA on public basis since 1990. Radev graduated from the Law Faculty of Sofia University St. Kliment Ohridski and later specialised in marketing and management in the US.

Currently, Radosvet Radev is the executive director of media conglomerate Darik Holding, chairman of the supervisory board of Doverie – United Holding Plc and chairman of the seaside-resort operator Albena SC.

Mr. Radev, you took over at the top of the oldest business association in Bulgaria – the Bulgarian Industrial Association (BIA), which has 38 years of history. What are going to change and what are you planning to upgrade?

Business organisations are heavy ships and it is hard to make sharp turns with them. I believe they are one of the proper places for conservatism on Bulgaria. Conservatism is a quality with them, not a disadvantage. From this point of view nothing must be changed in this business organisation's definition – how and why it exists, which are its members, how are they represented, how does it communicate, etc. This is the meaning of a business organization. However, everything could be done better, faster and with more vision for the near and far future. Because the 21st century has proven to be very dynamic. The largest deficit currently is the shortage of time for making management decisions. Not because people have become more stupid but because time has accelerated its pace. This is where I see my role in the BIA – to introduce a faster model of decision making, of proper evaluating the current state, of envisioning the future.

And of having a dialogue with the state. Do businesses talk to the state? Is the voice of businesses heard?

Yes, it is heard. We recognise that trade unions and employers, as participants in the social dialogue and the tri-partite partnership, can have their immediate interest and more strategic interests without being antagonists to the state. Of course, every party cannot defend these interests all time. Sometimes, trade unions are better in defending people's interests they represent, while employers and the state protect these interests better. There is no alternative formula at hand.

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A most essential problem for business is the shortage of labour. Are you pleased with the measures that the government has introduced for reviving vocational education?

Governmental measures have not led to any positive result so far. But I am pleased that it started communicating with us, that it indeed began discussion about dual education, and about it as a mantra but with the thought of how to fill this formulation with actual content. Early this week, we had a meeting at BIA and it recognised that dual education is a tradition in all countries where it exists. We must build it from scratch and come up with our own traditions. In countries like Germany parents are the ones that spend efforts in directing their kids in the right direction and they are very happy when their children become trainees in this form of education.

But businesses need personnel right now and immediately. What would be the solution for the next four years before the first educated specialists graduate from the currently introduced new vocational courses?

The problem of labour shortage will deepen. And we are far from the peak of the crisis now. The peak will come around 2020-2021. At that time, we will feel the impact of the most severe shortage of labour. Therefore, now is the moment for businesses in partnership with te state to look out for and find theoretical workforce reserves.

Where do you see them?

Encouraging young people that are expected to find their way into the labour market and become active parts of it. The share of unemployed persons in the age bracket of 15-34 was more than 17% in the first quarter of 2018. Besides young people, we also see potential in early retirees. There are people that, because of their type of labour – miners, military officers and others – retire earlier. In fact, they are men and women in the prime of their life. They could further their education in new areas. Another option is the redirection of people with disabilities to proper working positions. These people have personal and professional qualities and life experience that are no less sought by employers. I believe the we can solve our social problems in the battle for workforce. And of course, the fourth and easiest was, but far from magical, is the migration of people from non-member states of the EU that come from countries with lower wages, lower than pay in Bulgaria. This is something we know very well because we were a 'donor' in this field in the past 20 years. Now, we must turn into a recipient country. We already do it. This year, we have twice higher labour-force migration than in 2017.

You have bene involved in tourism for years, you are the board chairman of one of the largest Bulgarian resorts – Albena. How does Albena deal with the shortage of personnel?

Exactly this way – by importing workforce. We were pioneers in the seasonal labour-force migration from Ukraine and Moldova – completely legal, with observing all regulations of both sides. Curious enough, now we started importing Vietnamese. In fact, we brought back Vietnamese. 45 of them work with us for the first time.

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After the meetings of prime minister Boiko Borissov with Vladimir Putin and especially after the launch of the 16+1 initiative with China there are great expectations of attracting more Russian and some Chinese tourists. What is the formula to achieve this?

Let us not make these great expectations even bigger. If only half a per cent of the Chinese population comes to Bulgaria, our tourism will look much more different.

They are interested in cultural and historical tourism. What is their future according to you?

It is exactly this tourist sub-sector that has the deepest reserves because it is the less exploited one. There are resources there that we can use to welcome much more people. As for the Russian tourism, unfortunately most Russians are not in Bulgaria.

We missed them?

I would not say that. We exist in an extremely complicated competitive environment. Look at the measures Turkey takes, or the events-filled visits in Cyprus. We are not alone on the market.

And the political speeches of Vladimir Putin that direct Russian tourists to one destination or another?

True. But it is now that we are losing the battle for the Russian tourist. And this is a poor situation.

Discussions on Budget 2019 have already commenced. Trade unions declared their insistence for 1.7 billion leva more to increase wages in all sectors. Have businesses started their talks and what are they going to insist for to be considered in drafting next year's budget?

Yes, we have begun working on clearing our employer demands and positions. But you know what? This is a bit like playing poker – no one has seen their cards and the bets are on. First, we must have an absolutely clear view of what's the economy's state in the second half of 2018. Second, we must have our clear understanding of what we want to see happening in 2019. Budget is not made for its own sake. It is the means for achieving goals. Therefore, we have to know what we want from this budget and it includes preserving the well-operating economy. To protect our labour force, to end the year with another surplus, or a small deficit, to manage other concerns. Meanwhile, historically, we have to drag ourselves with the funding of the National health Insurance Fund, the National Social Security Institute because of their rising debts. Do we want more Bulgarians to receive medical health abroad, which lost us 120 million leva? In regard to this particular problem, I assure you that the sober-minded Bulgarian business will support what is of benefit to society. We would not allow a relatively working system with a clear vision to be destroyed.

So, you will support a balanced budget, without extremes in its expenditure part?

Categorically. And if there are expenses that are higher than usual they must really be used to clear financial liabilities that have been accumulated with time.

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You are the owner of Darik Radio. Darik, like Standart newspaper, participates in many public campaigns. Together we initiated the humanitarian campaign entitled "You are not alone" to save the Bulgarian medics that were imprisoned in Lybia. Why do we need the media today to have a social soul?

Because this is the reason for their existence. There is no better mediator between society and the incumbent politicians than radio, television and social media. This co-operation was born four centuries ago. And even today, society does not reject it. On the contrary, it enhances media and their institutions. They are the ones to gain most of the technological boom. In fact, new technologies did not change the substance of the media but rather change it technologically. It became faster and more colourful, now it offers more variety. Well, you pay your dues to fake news, but this is the 21st century.

How could serious media fight this scourge of the society – fake news?

By persisting in being serious and socially-oriented. They must remain media. Not by becoming bullies, not by being one-sided and one-directional in the impartial coverage of our colourful life. People recognize media usefulness. Very often old, conservative, off-line media are the ones that manage to provide its audience with instruments to deal with its lacking evaluation of public processes. The deepest problem of today's people is not the lack but the surplus of information. Currently we are drouned in an ocean of information. Conservative, old media, which include Darik and Standart, we are the life-belt in this aggressive ocean of news. Old media allow us to see the wind, the air, the direction, as well as the ground-sea swell...