In order to retain workers in regions, they must make the same money as in Riga

Baltic Block Info
May 8 · 4 min read

In order to motivate workers to stay in their regions, thus also guaranteeing income to the budget of local governments and improving the overall living conditions of locals, employers must be willing to offer wages and social guarantees equivalent to those in Riga.

This is a basic principle that is always kept in mind by Latvia’s largest manufacturer of pressed woodchip pallet blocks “Baltic Block” and its director Andis Šķēle.

“Baltic Block” is a company that manufactures composite pallet blocks, and we chose to develop our factory in Madona Municipality from the start; moreover, we have become one of the largest employers in the region in a relatively short period of time. As is the case in other parts of Latvia, it is quite difficult to attract already qualified workforce in Madona Municipality, therefore every individual is invaluable to the company. Certainly, this is a problem that is present all over Latvia, having formed due to demographic shifts and in large part because of unpredictable tax policies, now resulting in the fact that there are no more people left in the countryside. Even companies from unrelated industries often compete for potential employees.

The deficit of workers portrays the readiness of a company to go to battle in today’s labour market. In order for a regional company to be appealing for locals, it essentially has to offer wages and social guarantees that are equal to those provided by companies operating in the largest cities of Latvia. Moreover, they must be willing to train new employees and motivate existing ones for their own money. It is evident that in the case when an employee has equal work opportunities in Riga and his/her home region, the employee will choose to stay at home, not migrate abroad or to Riga. This is usually very complicated and forms unnecessary stress, and not everyone is able to find a job elsewhere. The rotation of any employee costs a lot for a company, and the challenge is not only formed by demographic aspects, but also by the ability to keep the respective people.

In the case of “Baltic Block”, we look for people who have at least meagre technical knowledge and train them further ourselves. Taking into account that we have a stable team that has been working together for several years without any significant changes, we cannot complain about the efficiency, knowledge or level of competence of our employees. Of course, there are industries that employ foreign workers, because locals are poorly motivated or do not carry out their tasks at the required level of quality due to some reason, but I think that this problem is not as pronounced in woodworking.

The labour force issue marks another problem that is present in most Latvian industries ‒ companies themselves must get more involved in the development and education of future professionals. The largest industries of Western Europe exhibit a trend of companies providing paid training courses to their employees, offering scholarships to students who choose to study in programmes related to their industry, carrying out various professional contests, as well as engaging in the preparation of academic programmes. In conditions of limited labour force this is the best way for ensuring the timely continuity of qualified labour and for raising the overall efficiency of an industry. Certainly, there are separate companies in Latvia that pay attention to this, but there is still room to grow. As modern technologies keep on developing, education will play a more crucial role. Technology management will become more complex, and technologies will replace certain professions, in which people are currently employed. Competition among employers, as well as employees will most likely increase.

Undoubtedly, this also characterises the state’s long-term planning policy. In Latvia, specialists are still being prepared in industries that have overproduction of labour, whereas other industries are left with what they can find and make do.

As one of the largest companies in Madona Municipality, we hold substantial social responsibility for the municipality and its people. “Baltic Block” currently employs approximately 100 people and 95 % of them are locals. By hiring these people, we have a direct and indirect effect on part of the municipality’s economy, as well as give our employees the possibility to work and live at home. Those living in the countryside need stability that includes an adequate and official salary, social guarantees and insurance. Here they have access to the same things as people working in companies of the woodworking industry in Riga. We must adapt to the scale of large enterprises in relation to employees, otherwise it would be very difficult to compete in the labour market.

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