Income and Employment in Rural Areas in Bulgaria after Accession to The EU

Diliana Mitova

Abstract: The aim of the present study is to trace and analyze some typical processes related to income and employment of the population in rural regions in our country in the last ten years and to outline the main problems in this direction. Rural development was an inseparable part of the CAP 2007–2013 and is still in focus during the current programming period. Regulation (EU) No 1305/2013 details the reform of the EU’s further rural development policy. One of priorities is ‘to promote social inclusion, reduce poverty and economic development in rural areas’. In this regard, the issues related to income, employment, poverty and social exclusion of the population living in rural areas are important to outline some of the peculiarities of the rural areas of the EU countries and in particular in our country and are an indicator of the extent to which the agricultural policy contributes to the differences in individual regions be reduced or mitigated. The subject of the survey is employment and income in predominantly rural (as well as in the intermediate and urban) regions of Bulgaria. Rural development statistics aim to measure economic, social and environmental issues related to rural areas. They give an idea of the specific features of the regions in the light of their classification as rural / urban. The approach used is based on the methodology of typology in defining urban-rural areas under Eurostat. In this analysis, based on available information by type of area, the following income indicators are considered: Gross value added (GVA) per occupied by area (predominantly rural, intermediate and mainly urban) - per one employed in all types of economic activity and one employed in agriculture, forestry and fish farming. As additional indicators, GDP by regions, GDP per employed by regions are also used, as well as population employment by type of activity and regions. The Mean equivalised net income in rural areas (by degree of urbanization) is also analyzed - to determine the average disposable income (net) per person in rural areas. Characteristics and problems as well as the role and impact of the policy (CAP) on employment and income in the Bulgarian village and rural communities have been identified. The main results of the survey are related to the identification of employment and income in rural areas in the country over the last ten years and outline of the main problems. According to the degree of urbanization (DEGURBA) in Bulgaria in 2015, 32% of the population live in rural areas (on an average of 28% for the EU–28); in cities and suburbs - 26% (31.6% EU average) and in large cities – 42%. (40.4% on average for the EU). Employment in all economic activities in total for all regions decreased by 7.5% for the period 2007-2015, with 7.7% reduction for predominantly rural regions, for the intermediate regions the decrease was by 11.2% and for the predominantly urban areas - an increase of 2.3%. Agricultural, forestry and fishery activities’ employment declined over the period 2007-2015 by 10.3% for all regions; for intermediate regions the decrease is 10%, for predominantly urban regions – decrease by 137%, and in predominantly rural areas there is a minimal (1%) increase in employment. The GVA per capita in the predominantly rural and intermediate regions, both in all economic activities and in agricultural activities, tends to increase over the period 2007–2015, but the rate of this increase is slower in predominantly rural areas compared to other areas, indicating that there is a significant difference in the incomes of the employed in the different types of regions, in favor of those living in predominantly urban ones. Mean equivalised net income in absolute terms has grown over the years for all types of areas but again at the slowest pace for rural areas compared to cities and suburbs and to large cities. The amount of net income per person in rural areas is significantly lower than in other areas, and these differences in net income in the various regions have worsened over the years. In all regions there is a large share of the population living in poverty or social exclusion. But for rural areas this percentage is the highest. The higher risk of poverty in rural areas is due to lower employment of the working population, higher unemployment, lower educational attainment and lower incomes.

Keywords: employment; income; intermediate regions; poverty; predominantly rural regions; social exclusion

Date published: 2019-01-16