EU: Romania’s Self-Employed Workers Face High Risk of Poverty

The majority of self-employed workers in Romania face the risk of poverty and social isolation, way above the EU average, according to the Statistical Office of the European Union.

In seven out of ten cases, Romanians who work for themselves are at risk of poverty and social marginalization. Portugal is the following country in the ranking, although its 32% percentage is far lower than it is in Romania.

The self-employed are people who run their own business, operate a small operation, or engage in a profession of their choosing, such as service and sales personnel, artisans, farmers, technicians, or managers. The statistics office further says that those who engage in such activities typically do not receive a salary but payment directly from clients for their services.

According to Eurostat, the percentage of vulnerable workers increased significantly during a year in Romania (+5). In contrast, the rate fell by 3.7% in Hungary, a neighbouring country. Romania, Portugal and Estonia recorded the highest shares of self-employed people at risk of poverty and social exclusion (70.8%, 32.4% and 32.2%). Romania, in particular, experienced the highest increase from 2020 to 2021.

More than that, International Monetary Fund (IMF) predicted that the unemployment rate in Romania is expected to rise to 5.6% in 2022 from 5.3% in 2021. Unfortunately, the numbers could get worse by 2023.

Some of Romania’s extensive and severe problems regarding the labour force segment are that the Romanian state does not encourage young people to enter the labour market and does not encourage Romanian entrepreneurs who want to develop employment opportunities. Therefore, many people in Romania risk poverty, one of the reasons why Romania has such a large number of emigrants, and it’s facing a massive decrease in population.