Borc: “I don’t want Romania to stay a low-cost labor destination”

Romania’s workforce faces a lack of qualified workers and is still a low-cost destination, said Costin Borc, deputy prime minister and minister of economy, commerce and business relations.

“Labor quality is lacking. Production units in Romania are some of the most performant, but labor shortages appear. I do not want Romania to remain a low-cost labor destination. I want to create centers of research, innovation and engineering, excellence centers. I want to attract investors, to stimulate start-ups,” Borc stated during the Romania-Switzerland Investment Forum.

According to data released by the National Institute for Statistics today, the average net earnings in Romania rose to RON 2,051 in March 2016, up 5.2 percent over the previous month and 12.1 percent year on year.

Salaries have been on an ascending trend throughout 2015, starting at RON 1,740 in January and ending the year at RON 2,114. Although in January 2016 earnings dropped back a notch to RON 1,943, mainly due to seasonal bonuses influencing the December results, the increase was constant for the first months of the year.

However, Romania still ranks very low among EU members in terms of average income and purchasing power, still making it a desired destination to find cheap workforce. Data from 2015 placed Romania next to last in terms of average net salary (EUR 417), just above Bulgaria (EUR 356). When it comes to purchasing power, Eurosat data for January 2015 posted Romania at 445 PPS (as compared to Luxembourg’s 1,597 PPS, the highest level), once more second to last, standing above Albania.