Resignations and adjustments on the Romanian labor market

In 2021, the second year of the pandemic also brought about an unusual, if not unexpected, phenomenon on the labor market - a massive number of resignations. Seen as "the great resignation" in the USA, the phenomenon turned global, also affecting Romania. A recent survey attests to the existence of the phenomenon. Raluca Dumitra, a communication manager with an online recruiting agency told us more:

"Candidates are more willing to compromise. At the start of the year, we conducted a survey among job-seekers and it turned out 21% of employees would quit their current job, even if they don't have a backup plan. It's a rather high percentage which I think should worry employers, all the more so as restrictions were lifted on March 9. This means employers will want to get people back to work, considering workers want to remain flexible. A return in block to the workplace would also possibly prompt employees to resign. Another interesting fact is that right now candidates are extremely optimistic. Around 75% of Romanians believe they might find a job within three months. It's a high rate of optimism considering the reality on the market. Most industries and sectors are facing a significant labor shortage, which means highly qualified experts might actually find a job in less than three months right now".

Petru Păcuraru, the director of a company that specializes in human resources has confirmed this phenomenon, also identifying its causes:

"One reason would be that 2020 was a year of uncertainty. People stopped switching jobs, meaning there were less people who resigned in search of a better workplace, but the situation changed radically in 2021. 2020 will be the year with the highest job retention rate in the history of mankind, as mobility was affected. Another reason is that, businesses have started moving back offline bit by bit. And then, part of the people who got used to working online will have a hard time doing their job, and for them this is a criterion when looking for a new job. And thirdly, I might add, despite economic difficulties, we see people continue to invest in luxury goods. And one reason is that, in times of crises, people are thinking about what matters to them most. And those who were about to compromise, thinking they would keep their job until they find something better for themselves, found themselves in a bad spot and realized the tradeoff wasn't worth it, and they mustered up their courage to look for something better".

At the same time, people who dare resign without any safety net have a financial and professional status above average, Petru Păcuraru told us:

"If we look at demographic and income indicators, we will certainly notice people over the age of 30 or 35 taking this decision, as well as those whose education and income levels are above average. However, resigning is not always followed by an immediate reemployment solution. An example are those working in highly volatile sectors who face high stress levels that can lead to burnout. The decision to stop working is not determined by finding a new job, but merely by the will to stay alive".

Although resigning without a backup plan might seem a decision stimulated by an exaggerated sense of optimism at first, the latest developments on the labor market do justice to those who believe a new job, one that is better-suited for them, will sooner or later appear. Raluca Dumitra told us more:

"For instance, last month we had 38 thousand new jobs listed on our platform, which is tantamount to the war in Ukraine. If we look at the previous month, we will notice a 13% increase, considering this is a difficult context we're talking about, meaning people continue to switch jobs. Candidates continue to apply and we have some 900 applications every month. Therefore, people continue to resign and are prompted by jobseekers' desire to find a better job. In terms of the number of applications, they are down compared to the same period last year, but that's not a surprise, since last year came with record-high numbers of applications. This time last year, the market did not favor job applicants. Last year, employers were in a position of power. Another important aspect is that 8 out of 10 Romanians for whom switching jobs was a priority have already started looking for a job. And this is also reflected in the high number of job applications we continue to receive".

Of course, there are sectors where the demand of workforce is higher, such as retail, transport, hospitality, call-centers and IT&C. Therefore, the market will continue to change, Raluca Dumitra argues.

"We cannot compare to the wave of resignations in the US, and I don't believe Romania will get to that point, simply because we are talking about a different culture and mentality. Yet it is worth noting that Romanians are growing increasingly aware of the context and the fact that there are many jobs available, even in times of pandemic or war. This makes them feel more confident, even though they don't have backup plans. The high number of jobs will definitely favor the wave of resignations over the coming period. All that must be analyzed in a geopolitical context, of course, but once a ceasefire is reached, the labor market will continue its current course and we'll be seeing more resignations". (VP)