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Bulgaria does not encourage innovation, but the restaurant industry

So far, forecasts for the labor market in Bulgaria have not taken into account the impact of AI and technology on jobs, the Ministry of Labor and Social Policy reports

Feb 13, 2025 06:01 77

Bulgaria does not encourage innovation, but the restaurant industry  - 1
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Comment by Emilia Milcheva:

What can a warehouse worker do when he loses his job because of artificial intelligence (AI)? Or a store clerk, cashier, bank employee, truck driver displaced by unmanned trucks, editor, copywriter, clerk, folder carrier, lawyers? They will protest in front of parliament – because politicians are not threatened by the AI revolution, but their inaction will sooner or later be punished by civil discontent.

„Professions will not disappear, a certain class of people will disappear – the mediocre. And that will be very sad, because they will not even understand why they are not being realized,“ commented for Deutsche Welle, the Chairman of the Board of Directors of BRAIT (Bulgarian Employers' Organization for Innovative Technologies) Dobroslav Dimitrov.

Only the best will have a chance

„Companies will prefer to work with the best and will throw out the inefficient. Artificial intelligence will revolutionize every aspect of the economy, especially professions related to cognitive activity – and two-thirds of Bulgaria's economy is in services“, he says. In this sector, however, most of the employed are women, which means that they would end up being the largest share of the future unemployed.

Dobroslav Dimitrov emphasizes the urgent need for qualification, since the cardinal change is occurring within a horizon of 4-5 years. „Everyone must take responsibility for their own life. There are countless opportunities for additional qualification on the Internet, and chatbots – our best friends, can be the ideal mentor.“ According to him, the future role of man will be managerial, not executive – team leader of a team of agents (models and algorithms with artificial intelligence that can make decisions and perform complex tasks on their own, b.a.). If the transformation does not start now, Bulgaria is threatened by structural unemployment and the gap between people with high and low incomes will widen even more, the ΙΤ entrepreneur believes.

A sweet native picture

So far, forecasts for the labor market in Bulgaria have not taken into account the impact of AI and technology on jobs, the Ministry of Labor and Social Policy (MLSP) reported in response to a query from Deutsche Welle. By the end of 2026 However, long-term forecasts for the development of the labor market until 2035 will be developed, which take into account the digital transformation of the economy - under a project funded by European programs, the MLSP specifies.

“We have not even touched the surface of how AI will transform the labor market,“ commented to Deutsche Welle entrepreneur and Chairman of the Board of Directors of AIBEST (Association for Innovation, Business Services and Technologies) Iliya Krastev. According to him, the mass introduction of AI will accelerate when the pace of development stabilizes, but he is not very optimistic for Bulgaria.

“We are the only country in the EU that does not have legislation to encourage development activities and we have the lowest results in mathematics. We conducted a study with the Institute for Market Economy (IME) and it turned out that the average 15-year-old student in Bulgaria is functionally illiterate in mathematics. In a small economy like Bulgaria's, the state does not participate in innovation - but instead encourages the restaurant industry, which is clearly the priority sector.“

The data that Krastev points out are devastating - for the first time, over 25% of workers are over 55 years old, and in the coming years Bulgaria will lose 800,000 people of economically active age. Even more worrying is that only 3% of graduates continue to study and qualify, while the EU average is 12%.

“What is the benefit of having the most universities per capita in the EU?! A large part of the specialties are not filled, competition decreases and they become a money machine. You give public funds and spit out some children who have no idea what to do with their lives!”, says Iliya Krastev. Both he and Dobroslav Dimitrov are categorical that an education reform is absolutely necessary.

New programs for learning in a new way are needed

According to Krastev, in order for such a reform, which does not have time to be evolutionary, to happen, political agreement is needed - and such will be difficult to find in the current parliament. “New programs for learning in a new way are needed, which include financial culture, software skills, etc., and there are no prepared teachers”. Dimitrov is also in favor of a radically rethought education that would teach children to think critically and creatively, and he also advocates for a network of technological schools, using mathematical high schools as a basis.

There is no time. While Bulgarian education is still struggling with analog models, and politicians are watching to prevent "genderism" from sneaking in and "I am Bulgarian" from remaining, the future is already here. The World Economic Forum (WEF) has published its report "The Future of Jobs 2025", according to which 40% of companies plan to lay off staff due to automation with AI. The good news is that artificial intelligence could create 170 million new jobs worldwide, eliminating 92 million, which is still an increase of 78 million jobs by 2030. Two-thirds of employers plan to hire employees with specific skills in the field of AI.

And in Bulgaria? For the first time in 2025 The Employment Agency, which annually surveys employers' workforce needs, will include a question in the questionnaires about the impact of digital transformation on their staffing needs. In their response to Deutsche Welle, the MLSP also said that until March 5, entrepreneurs can apply for training their employees under the "New Skills" procedure, which also includes "specific digital skills related to artificial intelligence". The grant is under the European Human Resources Development Programme - from 20,000 to a maximum of 5,867,400 leva per project (the total budget is 74 million leva).

AI Factories to Nuclear Power Plants

When European Commission President Ursula von der Leyen announced in Paris that 200 billion euros were available for the development of artificial intelligence, Prime Minister Rosen Zhelyazkov said that Bulgaria should make the most of it. In the French capital, where the AI summit took place, Zhelyazkov was accompanied by Prof. Martin Vechev, Director of the Institute of Computer Science, Artificial Intelligence and Technology (INSAIT), who announced a project in connection with the EC's initiative for “AI Factories”. The goal is to increase the computing power available for AI development in Europe.

Bulgaria is an extremely suitable place, Dobroslav Dimitrov commented on the idea of a strategic infrastructure in the computing sphere, “corresponding to the construction of units 7 and 8 at the “Kozloduy” NPP””. Nuclear energy can power such factories, God forbid, we attract one of the big technology giants, he says.

We are already talking about competition between countries and companies, notes Iliya Krastev and gives the example of Amazon, which will invest in nuclear energy production to power its data centers and thus expand its services based on artificial intelligence.

Where is the state

The two IT entrepreneurs are concerned about the lack of discussion about what kind of economy Bulgaria wants to develop and what efforts it should take to attract and retain highly qualified specialists. “Bulgaria is first in the EU in terms of the share of the shadow economy - what does the state promote through its tax and social security policy, burdening young professionals who create the new economy!”, Dimitrov states.

Iliya Krastev notes the lack of a state policy to retain qualified people. “All countries are extremely aggressively trying to attract top experts, and in Bulgaria we are raising the tax and social security burden. If the state is not able to retain high-class specialists, there will be low-skilled people and an education system that produces them. How then do we create a high-tech and competitive economy!” But Krastev also points out another problem related to the protection of intellectual property - “that is why, for example, in the case of startups, a large percentage of their intellectual property is not in Bulgaria, but elsewhere, where it is protected”.

In order for there to be a meaningful conversation about the future between entrepreneurs from the “new economy” and the state, they must be allowed to participate. Dimitrov and Krastev point out the government's refusal to recognize the ΙΤ sector in the person of BRAIT as a representative organization of employers at the national level. Thus, they cannot participate in the discussion of the budget, tax policies and other key issues together with the executive branch, other employers, large unions - and BRAITH will file a lawsuit for the refusal.

Strategic reading is missing

Strategic reading of the radical transformation that artificial intelligence is carrying out is missing. Bulgarian politicians think and decide in the short horizons until the next elections and do not care about the Fifth Industrial Revolution. And while they are discussing how many billions to allocate for the renovation of old blocks, AI is already designing the future.