Haskovo Economic Centre

HASKOVO ECONOMIC CENTER 

• INTRODUCTION | Key indicators for the Haskovo economic center

• COMPOSITION AND LABOR MIGRATION

While in the previous edition of the study in 2017, Haskovo was an economic center that consisted of only a core with no periphery, in the current one the city of Haskovo is joined by the neighboring munici­palities Mineralni bani and Stambolovo. The core re­ceives about 450 workers from its peripheral munic­ipalities every day: this migration has a significantly higher impact on the labor market in Mineralni bani, where it accounts for 17.4% of employment. The largest number of labor migrants in Haskovo come from Dimitrovgrad – 1,200 every day, making it likely that this large nearby municipality will soon join the economic center.

• ECONOMY AND INVESTMENT

Haskovo is the second smallest economic center in terms of production value: in 2021, the produc­tion value in the three municipalities amounted to 1.54 billion BGN, or 16,700 BGN per capita. Over the last 10 years, it has been one of the fastest growing centers in the country, registering a 74% increase in value added. The economy of the centre is highly concentrated in the city of Haskovo, which accounts for 95.6% of the value added, Mineralni bani ac­counts for 2.4%, and Stambolovo for 2%. The growth rates of the individual municipalities are also un­even, with the economy of the core growing by 74% over the decade; Stambolovo registered only 30% growth in value added over the same period, while Mineralni bani registered a full 139%.

The structure of the center’s economy is largely dominated by manufacturing, which accounts for 31% of value added and trade, which contributes an­other 24%. Construction (13%), healthcare (9%) and transport and logistics (6%) also have a relatively high contribution, and the high share of agriculture (5%) is notable compared to the national economy. Agriculture is also the largest sector in the two pe­ripheral municipalities, generating almost half of the value added in Mineralni Bani. The centre is char­acterized by relatively low labor productivity, with value added per employee reaching 15,100 BGN in 2021. The large companies in the center are almost exclusively concentrated in Haskovo municipality, with the leaders in terms of revenue being the con­struction company AB, the tobacco trader Tabaco Trade and the engineering company PIM, while the largest employer is the general hospital with over 650 employees.

FDI in the center is relatively low – only 94 million EUR at the end of 2021, or just over 1,000 EUR per capita, and 92 million EUR of it were in Haskovo mu­nicipality. Current investment activity is also relative­ly low, with spending on land, machinery and build­ings in the three municipalities totaling 151 million BGN in 2021, of which 142 million BGN in Haskovo municipality. Industry (50 million BGN) as well as commerce, transport and tourism (40 million BGN) account for the highest investment expenditures for FTI acquisition in the core, while in Stambolovo and Mineralni bani the leader is agriculture. The activity of the companies is mainly oriented to the domestic market; in 2021 the export revenue was 377 million BGN, which is the lowest value for all economic cen­ters except Kozloduy.

• LABOR MARKET

After a significant increase in the course of the Covid pandemic, unemployment in the Haskovo economic center still remains relatively high compared to the leading centers – 5.6% in 2022 according to the Em­ployment Agency; almost twice this figure in the mu­nicipality of Stambolovo. Long-term unemployment in all three municipalities is low, exceeding 1% only in Stambolovo. However, the share of those who are inactive is relatively high – between 31% of the employable population in Mineralni Bani and 49% in Stambolovo, while the total number in the cen­ter reaches 20,000 people. According to the census data, 33,000 people are in employment in the cen­tre, or 58% of the working-age population. Slightly less than 30,000 of the people in employment are in the city of Haskovo, 1,700 – in Mineralni bani and 1,300 – in Stambolovo.

The Haskovo economic center has seen a relatively rapid contraction in employment, with a 7% decline over 5 years. The distribution of employees broadly mirrors that of the center’s economy, with 34% em­ployed in manufacturing and a further 23% in trade.

The Haskovo center has registered a relative­ly high salary growth over the last 5 years – 53%, but the average salary for the three municipalities of 1,096 BGN per month remains the lowest of all centers in the country. The highest salaries are in the healthcare sector in Haskovo municipality – 2,025 BGN per month, and in the energy sector in Stambolovo – 3,149 BGN per month, but the number of employees in it is very small.

• HUMAN RESOURCES AND WORKFORCE

The educational structure of the Haskovo center is an important limiting factor for its development potential. According to the 2021 census, the share of people with university degrees is 21% among the population aged 7 and above, compared to 32% with primary education and lower, and illiteracy is 1.9% among those aged 9 and above. The distribution is even more unfavorable in the small municipalities, with Stambolovo reporting a 57% share of people with primary and lower education and only 7% of those with higher education.

The performance of students in the economic center is also not particularly impressive, with an average score of Good 3.64 on the matriculation exam in BLL in the 2022/2023 school year and an average score of 30.4 on the NEA in mathematics. As expected, results outside the Haskovo municipality are significantly lower.

Compared to other smaller centers, Haskovo has performed relatively well in demographic indica­tors. Between the last two censuses, the population has decreased by 13%, to 92,300 persons. This in­cludes 57,000 persons or 62% working-age popula­tion, while the share of population of retirement age reaches 24% and the demographic replacement in­dicators point to a rapidly ageing population.

The population dynamics of the Haskovo center is predetermined by a relatively low migration, with the net migration rate in 2022 at 0.6‰ for the center as a whole, though positive only in Stambolovo, where it reached a record 45‰. The natural growth rate for that year was –10.6‰, markedly lower in Stambolovo.