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Human resource sector thrown into crisis

  • 2007-01-31
  • By Todd Graham

UNFINISHED BUSINESS: Construction projects are being stopped in their tracks due to the region's lack of workers.

RIGA - The mass exodus of workers from the Baltic states to the West, on top of the Baltic's low wages and booming economy (with workers not educated to serve it) make human resources one of the most frustrating sectors in the region. And those within the profession 's placed on the frontline of the Baltic's current labor crisis 's are sweating to find solutions for the region's growing employment problems.

On Jan. 29, the Latvian television program "100.pants" reported that Bank of Latvia analysts had predicted a "worst case scenario" of current demographic and emigration trends over the next 10 years, where some 200,000 people will disappear from the Latvian labor market.

This outflow of workers is causing the biggest challenge for human resources professionals. Not only are Baltic recruiters struggling to deter employees from heading abroad, they're also pressed to find qualified professionals within state borders.
"The most difficult thing will be keeping our employees working within their home countries, and secondly getting back those who have left. Our third priority is to change the overall attitude toward young women, elder people and specialists. [We need to] figure out how to keep them motivated and either offer them benefits or the flexibility that they expect," said Kadri Johanson, a representative of CV Keskus, an online Estonian recruiting firm.

Viesturs Bulans, business manager of the Baltic states division for CVO Group, which operates online recruiting Web sites in all three countries, echoed this point.
"The situation employers are dealing with is like an open window: You find a good worker, but someone can always offer the worker five lats more and take them away. So even if a business creates a good motivational system, sooner or later someone can always just steal that worker away simply because other businesses also need that person," Bulans said.
What's worse, the Baltics' employment problems are leaking their way into public schools. Due to the labor market being so tight, students are not completing their courses of study. Instead, they are jumping into work before their studies are even finished.

"There are not many good specialists left, only students who are being pulled out of their first and second year for work," Bulans explained. "A first or second year engineering student, for example, is no expert. Businesses are offering them a salary of 600-700 lats (863-1,007 euros) just so there is at least someone there to do the work. It is a bit absurd, but this is the situation because there are no others qualified to fill the vacancies."

There are specific challenges for recruiters in each Baltic state. For example, Lithuania's economy is more geographically dispersed than Latvia and Estonia's, which causes mobility problems.
A specialist that is needed in Kaunas (central Lithuania) but lives in Klaipeda (on the Western coast) would have to be convinced to move to that part of the country.

Comparatively in Latvia, most businesses are located in Riga, making recruiting easier.
Baltic human resource companies agree that there is a crucial need for developing a cohesive strategy. How they will go about doing this is the pressing question. And clearly, there's not much time.