In BR’s recent analysis, Coronavirus outbreak reshapes local workforce market, one of the main stories of our April print issue, Ionut Sas and Oana Munteanu of PwC Romania shared their valuable insights on the Romanian HR industry, so Business Review decided to follow up with them. Oana Munteanu will also be a speaker in the upcoming Working Romania online conference.
Business Review: In the current conditions of the crisis generated by the COVID-19 pandemic, is Romania prepared for remote work during a longer period of time (from both employee and employer viewpoint)?
Oana Munteanu, Senior Manager People and Organisation: The outbreak of the Covid-19 pandemic forced every employer in Romania to make quick decisions in order to reduce the negative impact on their businesses and employees as much as possible and to be able to continue their operations. According to an HR Barometer conducted by PwC Romania between March 11-13, 58 percent of the companies included in the study implemented the work from home system solely for those employees who can work remotely while 25 percent did this for all their employees, while 13 percent decided to make remote work mandatory.
The work from home system has two major implications: technology and culture. Fortunately, digital infrastructure is the only aspect of digitalization where Romania is highly advanced. Our internet speed is among the best in Europe and so far it has been coping very well with the myriad of video calls and conferences. At a micro level, the tools that companies have at their disposal to make virtual work possible are crucial. Multinationals and software companies are among the best prepared for virtual work, because those companies needed to create global teams and projects with reduced expenses and have already invested in apps and infrastructure that allow them to implement remote work.
In order to reduce the stress on technology, some companies have adopted shift work or even limited the number of virtual conferences in certain time slots, so that they can avoid overloading the system during busy hours. Other companies have overstrained their IT departments, but fortunately, the current offer for tools is huge and costs are affordable.
The second aspect, a very important one, is culture, the habit of working remote through virtual tools. Here, everyone is challenged because very few have worked so far exclusively virtual. The biggest pressure is on the “line” managers who need to make sure their teams are balanced and their workloads are fair, and they provide feedback and efficiently review their work. Like in any changing curve, after denial comes gradual acceptance followed by adjustment. As the pressure gets higher, and there are no other alternatives left, the adjustment and solution finding processes become faster. On the other hand, the emotional impact is extremely important, but the most ignored at the same time. We will learn, I hope, from this crisis, to value face to face interaction, which had recently been losing ground to technology. Before we can reach that point again, managers should be more attentive and communicate not just about business with their teams, to regularly talk to them, ask them about their health, their logistic or financial troubles, etc. and to try and make every conversation more personal (encouraging them to make use of video calls even if it’s a morning meeting and children are running around in the background), to be honest and transparent with the business related scenarios, and last but not least, to consult with their teams in order to find the best ways to do their jobs and reinvent the processes or products they are working on.
What will be the impact of this period on the workforce market and when do you think the local market will feel this impact the most?
Ionut Sas, Partener, People and Organisation Leader: The impact is already being felt. The most affected sectors are until now transportation, hospitality, and tourism. The negative effects will be transferred gradually onto other sectors because all industries are interconnected. In addition, large automakers which are major contributors to the local GDP have already either opted for furlough or adjusted their operations towards the production of medical equipment needed to address the current health crisis.
Both companies and local authorities need to think of a plan to support the private sector and secure the jobs and incomes of both companies and people.
In the meantime, there are sectors where demand has increased as a result of the crisis, like food retail, online shopping, pharmacies, medical services, telecommunications, technology, and online entertainment. However, the ripple effect of the drop in consumption and the constraints on resources as a result of closed borders will affect every activity. Yet it could generate new areas of innovation.
Optimistic scenarios talk about a significant “disruption” of the economy for approximately 3 months, on the basis of epidemiologic predictions. The recession will follow a “V” trajectory, meaning a sharp short-term fall, followed by a swift recovery. But, at the moment, it’s impossible to predict if this temporary fall of consumption & resource availability will have a major structural impact, which will cause a slow and difficult recovery. Also, it’s impossible to predict when medical solutions for prevention or treatment will appear, and what impact they will have.
There is a shared feeling, at an economical level, that this year can end without a recession and that the recovery can be made in the second half of this year and will continue into 2021. In any case, the crisis will have medium term effects, resulted from the reduction in mobility, the changing of consumer behavior, or the rethinking of work related interactions and relations. But many of these effects can be positive and lead to a shift of paradigm, which the world probably needed.
Is technology an ally of companies during this period, speaking about the robot-assisted recruitment process?
Ionut Sas, Partener, People and Organisation Leader: In the next period, the recruitment process will no longer have the same importance and volume as it did prior to the Covid-19 outbreak, because most companies have suspended or postponed new staffing. Things will be different for other processes that will rely much more on technology, like trainings or personnel evaluations. The current tech generation has solutions for every aspect of HR departments and monitors every work dimension, bringing important benefits. According to the HR Technology survey, the adoption of technologies by employees will be the real challenge. The positive side is that this crisis could anticipate this process. In addition, in their need to survive, businesses could generate new innovative solutions within a very short time.
HR tech solutions, developed in cloud, is a segment which many start-ups work on, bringing innovations that promise to help companies stay permanently connected to their employees and the talent recruitment networks.
At what costs will the Romanian workforce market be able to absorb the effects of the current crisis?
Ionut Sas, Partener, People and Organisation Leader: It’s difficult to estimate. All companies want to keep their employees, but also to survive economically. For everyone, layoffs are one of the possible scenarios, but efforts are made to avoid them. It very much depends on how the government will work with the business sector in this aspect. Unfortunately, 2020 caught Romania on the wrong foot, from the point of view of the budgetary burden, which limits the possibilities to support the private sector. Beyond the governments availability to communicate and find solutions specific to each industry, a balance is needed for every employee category. If the focus will be on the conservation of salaries and keeping jobs in the public sector more than in the private one, the gaps which have recently appeared in the local workforce market will only deepen.