Estonia draft would allow 2,569 foreign workers in shortage sectors

A draft bill would allow Estonia to issue up to 2,569 temporary residence permits next year to foreign workers in sectors facing labour shortages, ERR reported. The proposal, prepared by the Ministry of the Interior, covers fields including manufacturing, road transport and air transport.

Amendments to the Aliens Act taking effect next year would make it possible to grant temporary residence permits for work if an employer’s main activity is on the government’s list of labour-shortage sectors. The changes aim to ease shortages of skilled workers while managing security risks.

The proposed list covers 12 fields: manufacturing of electronic and electrical equipment; motor vehicles, trailers, semi-trailers and other transport equipment; machinery and equipment; transport and storage; chemicals, chemical products and pharmaceuticals; paper products; building materials; wood products; textiles; metals and metal products; rubber and plastic products; and the repair and installation of machinery and equipment.

The government would set a list of 20 activities based on those fields, valid for five years. When the economy is growing, the labour-shortage exception could be used to issue permits to up to 0.2 percent of Estonia’s permanent population each year. Under other economic conditions, the limit would be 0.1 percent.

The Finance Ministry’s latest forecast puts real GDP growth this year at 2.5 percent, meaning the economy is considered to be in a growth phase. Estonia had 1.284 million residents as of September 1, making the maximum number of permits next year 2,569.

The bill’s explanatory note says the country’s workforce cannot meet businesses’ growing demand for skilled employees as the working-age population declines and more people leave the labour market than enter it. Automation, education and retraining are among the measures being used to address the problem, but they are not expected to provide new workers quickly enough.

The proposal would offer shortage sectors a more flexible way to recruit foreign workers while retaining a wage requirement and a cap on permits, to protect Estonia’s labour market and prevent large-scale immigration of low-cost labour.

The list was drawn up using three criteria: OSKA’s labour demand forecast, the share of exports in a sector’s sales revenue, and its average annual gross wage. Electronics and electrical equipment manufacturing ranked as the sector with the greatest shortage, followed by manufacturing of motor vehicles and other transport equipment, and machinery and equipment.

Programming would not be included, despite meeting the criteria, because foreign nationals taking jobs in information and communications technology already have an exemption when the immigration quota is calculated. The energy sector is also excluded, although it is strategically important to Estonia.