Expats and an expanding EU

21st July 2003, Comments 0 comments

Do you thrive on fast-paced growth? The EU accession countries continue to offer opportunities to ambitious expatriates — but there may be a downside, writes Kristine Garcia.

The early and mid-1990s were a boom period for expatriate assignments in Central Europe. Billions of euros in foreign corporate investment were pouring into the top economies of the region and with these funds came sharp demand for qualified expats to fill upper- and middle-management positions. To sweeten the deal, many multinationals offered inflated salaries to workers who could set up new operations and get local employees orientated.

But the demand and prospects for expatriate workers in top investment regions such as the Czech Republic, Hungary and Poland have shifted since this heady period, and one of the reasons for it is European Union accession.

“EU accession is a bit of a double-edged sword,” says Mark Pautz, human resources director for Deloitte & Touche Central Europe. “Common legislation and common markets are all positive… But on the downside some of the investment incentives will change over the region and you’ll find increased [corporate] migration to the fringe or border countries.”

Since the fall of the Berlin wall, transnational corporations from Western Europe — predominately Germany, France, the Netherlands and the UK — and the United States have invested heavily in Central Europe.

But some of these businesses, particularly those in the low-tech manufacturing sector, have already relocated further east and south in anticipation of the increased labour costs that will accompany EU status in the 10 accession nations: Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia and Slovenia.

Since he arrived in the Czech Republic from South Africa eight years ago, Pautz has seen the expat employment outlook change considerably.

“The US has basically come and gone. They set up and handed things over to local operations,” he says. “The biggest opportunities would be in the [former-Yugoslavian] countries, and Bulgaria, Romania, etc. It would be a golden opportunity to invest there now.”

Moreover, many of the expatriate jobs that have not gone further afield have simply been absorbed by local staff. After all, one of the primary roles for expatriates in Central and Eastern Europe has been to work themselves out of a job by getting local workers up to speed.

“The local talent pools are getting stronger and their skills are getting deeper. There are generally [no positions] available lower than the executive and strategic level. Nothing lower than that,” says Pautz.

Finding the new expat growth areas

But not all of the expatriate prospects in the accession countries have disappeared.

While some jobs have moved to countries that are not yet due to join the EU (though Bulgaria and Romania have a target membership date of 2007), many expatriate employment opportunities have remained and others have sprung up.

“There was a drop off in expatriates in the three big markets recently but apparently their numbers are levelling, so I’d say there is more room for expats to be there,” says Judy Warren, a human capital consultant for consulting firm Watson Wyatt Worldwide.

Warren, who lived and worked for two years as a consultant in Budapest, also notes, “In terms of the skills needed, the ability to speak English, without question, is the biggest requirement, and general business skills… A real strong business approach is what you’re looking at."

But she adds that it is increasingly required to be almost fluent in the regional language, particularly for expatriates who are vying for lower-level positions where the focus now is on recruiting local-language speakers.

Outside of these multinational corporations, numerous technical, service and other industry sectors have grown in response to the influx of business investment, increased consumer choice and EU accession.

Expatriates from EU-member states will soon be free from work permit red tape to pursue these growth areas.

American Brendan Ian Burke, the executive English editor for the English-language news weekly The Warsaw Voice, arrived in

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