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In 2020, public officials felt almost no health crises, with only a small portion of employees paid from the state budget being sent into technical unemployment, while private employees barely survived, living in fear of tomorrow – that’s right how analysts characterize economic dynamics of the workforce during the pandemic. The economic support provided by the state came very late, both for the employees sent to the technical strike and for the support of some of the companies most affected by the March-April closure.
Thus, private entrepreneurs, who support more than 4 million employees, need time to breathe to keep the economy afloat, at least in terms of stagnant minimum wage growth in the economy. which has generated enormous expenses in the last 3 years.
Public sector wages are frozen only after successive increases in the last 3 years: for 2021, the Government of Cîţu has decided on a small increase in minimum wages in the economy, of only 3%, after an increase of 25 % in 2020, a measure taken simultaneously with the wage freeze. budget holders in 2021, at the level of those of December 2020.
“First of all, we are talking about an emergency ordinance adopted at today’s meeting (December 30 – ed.), Which contains several regulations and has a budget impact of 17.6 billion lei: the salaries of budget staff they remain at the December level, budgetary impact of 12 billion lei.
The decision is based on what happened with the wage law in the last three years. Romania is going through a difficult period. We did not cut revenues, they remain at the same level after a period in which they increased by 25%, “explained Prime Minister Florin Cîţu.
41 lei of minimum wage increase in the economy
In parallel, the Government decided to increase the minimum wage in the economy as of January 1 by 3%, from 2,230 lei per month to 2,300 lei per month, representing a net increase of 41 lei and a monthly net minimum wage of 1386 lei.
According to the Ministry of Labor, when establishing the basic gross minimum wage per country guaranteed in payment for 2021 at the value of 2,300 lei, a calculation formula was taken into account that takes into account the inflation rate of 2.2% and the 0.8% real growth. of labor productivity per person by 2020.
PwC: The role of these measures remains limited
Daniel Anghel, coordinating partner of fiscal and legal services at PwC Romania, considers that the role of these measures remains limited, requiring finding ways to keep companies affected by the reduction in activity afloat.
“The ways in which it will be achieved (reducing state spending, increasing taxes, improving collection or a combination of them) remain to be seen. At the moment, the freezing of salaries in the public system, of some pensions and social benefits, while support to the private environment continues through various facilities granted since the beginning of the pandemic. However, the role of these measures remains limited, which keeps companies affected by the reduction in activity, and the problem will be finding ways to stimulate economic growth ”, shows the PwC analysis.
According to her, the government is practically facing an extremely complicated problem: applying both reductions and increases in certain expenses, generating greater income and making all these adjustments without antagonizing segments of the economy or society, in an increasingly tense financial context. .
“The budget did not feel the health crisis, the private sector barely survived”
“2020 was a year in which the keyword was survival,” economic consultant Adrian Negrescu told “Adevărul”, noting that 80% of Romanian companies are poorly capitalized, which means they do not have the financial strength to pay higher wages.
“We had more than 1 million Romanians who returned from the West, in the middle of the pandemic and, with the savings, from what they have collected in recent years, they tried to resist. Many have managed to return, but still others, after almost a year of the pandemic, live on the brink of subsistence.
Some have found work in the country, but very few, others hope to return to work abroad in 2021. For the rest of Romanians, those who work in the private sector, they lived in fear of tomorrow. Many lost their jobs, others lived off technical unemployment provided by the state. For those responsible for the budget, 2020 was a good year, because they did not feel the crisis, being protected by politicians, in the context of the electoral year, “said Adrian Negrescu.
The private sector will restructure its business in 2021
Regarding the year 2021, the economic consultancy seems quite skeptical, suggesting that it will be the year in which many of the companies will restructure their businesses. “Efficiency will be achieved: working from home has seduced many employers, so many companies will seek to reduce their personnel schemes. The pressure on employees will increase, efficiency will be the order of the day,” considers the specialist.
“For the budget, the year 2021 could be one of emotions. The necessary restructuring of the public apparatus and the freezing of salaries at the 2020 level are at the forefront, given that salaries and pensions will exceed, as a level, the income expected by In conclusion, it will be another challenging year, with a first semester in which the economic crisis will be felt in the labor market and, hopefully, with a second semester in which the elimination of the restrictions imposed by the pandemic it will bring an economic recovery, especially in sectors such as HoReCa, transportation, events, cultural – severely affected by the pandemic, ”Negrescu added.
Trade unionists unhappy with the wage freeze
The end of the year was marked by several protests by trade unionists, either dissatisfied with the small increase in the minimum wage, up to 2,300 lei, compared to 2,400 lei (as demanded by the trade unionists of the “Alpha Cartel”), or by the freeze of budget salaries in 2021 at the level of December 2020.
Several members of the “Cartel Alfa” picketed the headquarters of the Ministry of Labor on Tuesday, December 29, while office workers held protests on Thursday, December 31 in front of the Ministry of the Interior and several prefectures, unhappy with the freezing of the salaries of the public sector.
On Saturday, January 2, the education unionists, affiliated to the “Spiru Haret” Trade Union Federation, asked the union’s leadership to initiate steps to organize protests, if the Government does not decide, until the approval of the Budget Law 2021 , increased education employees.
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