Employing Foreigners – One of the Most Profitable Businesses. For Now.

There may be a lack of domestic labor, but everyone suddenly understands the hiring of foreign workers. Such is the impression; large employers, public utility companies, smaller family businesses, crafts, services, various tradesmen, beauty salons… Everyone is bringing in foreigners and everyone has become skilled and proficient at it, so it is no surprise that the business of hiring foreigners has exploded. Suddenly, everyone has their ‘guy’; everyone knows someone who arranges visas and work permits, buys cheap plane tickets, and someone who has ‘in stock’ at least a hundred foreigners coming tomorrow for peanuts.

However, such a choice is risky: the sought-after worker may flee as soon as they land in Croatia or, at best, may not be qualified, so you will have a lot of work to train them for the job, which is a process that takes time. You might even be able to pay them ‘peanuts’ while they sleep on the floor of a shed, as your ‘guy’ suggested, and in the meantime, you become the new star of ‘Provjereno’ or some similar show, which really should not be anyone’s goal.

Nevertheless, the fact is that there is an unusual chaos in the market of agencies that bring in foreign labor, which is why those agencies that operate without any hidden agendas are lobbying for new market regulations. ‘State, save us from the greed of individuals in the market!’ When employers themselves say this, it is clear that things have gone too far.

Distant Destinations Take Over

It is no longer surprising that the dynamics of the Croatian labor market have changed significantly in recent years. There is a great need for labor in most sectors, and at the same time, we are witnessing a shortage. Emigration and catastrophic demographic trends have left such gaps in the market that they can no longer be filled even by a pool of labor from the region. Last year, as is already known, about 170,000 work permits were issued, and according to HZMO data, around 110,000 foreign workers were employed in Croatia in 2023. Some predictions claim that this year the number of issued work permits could rise to two hundred thousand. Since the beginning of this year, we have noted that more permits are being issued to foreign workers from distant destinations than from the region, and these trends will only intensify.

Unfair Competition

The business of bringing in foreign labor is handled by two groups of agencies: temporary employment agencies and employment mediation agencies. According to data provided to us by the Ministry of Labor, Pension System, Family and Social Policy, as of March 31, 2024, there were 708 temporary employment agencies and 629 employment mediation agencies in their records. Both bring foreign workers to Croatia. The former operate on the principle of being aggregators, those who already have their contingent of available labor in Croatia, while the latter act as intermediaries between employers and workers and work for a fee.

The numbers speak for themselves regarding how much the business has exploded: in 2022, there were 415 employment mediation agencies and 352 temporary employment agencies in Croatia, and if we dig further into the past, we will discover that in 2018 there were 187 temporary employment agencies and 109 employment mediation agencies in the records. The numbers are growing rapidly, and it is expected that they will continue to grow, with more foreigners and agencies bringing them in. While some operate according to the rules in this chaos, others avoid all rules to the detriment of foreign workers, employers, and also to the detriment of Croatia as a desirable destination for foreign workers.

What do employers and representatives of the real sector say about all this, and what do those who work legally in this business while respecting all laws and regulations have to say, and finally, what do foreigners say and how have some countries, like the Philippines, protected their workers abroad, and ultimately, how quickly can a foreign worker actually come to Croatia? Read about it in this week’s feature in the printed or digital edition of Lider weekly.