Lithuania’s annual quota for employing foreign workers has already been exhausted, prompting business groups to call for changes to the system, while the government says there is no reason to increase the quota next year and may consider reducing it.
Lithuania set this year’s quota at 24,700 foreign workers, but business representatives say it was exceeded in July.
Social Security and Labour Minister Inga Ruginiene said, however, that only about 10,000 new workers actually entered Lithuania this year, suggesting the quota system might be allowing the same worker to account for multiple quota places.
“About 10,000 new workers have actually entered this year, so we need to look at why businesses have already run out of the quota,” Ruginiene said. “Perhaps we need some adjustments. If we fixed this system, we would see that a much smaller quota would be needed next year.”
The International Transport and Logistics Alliance said reducing the quota would hurt not only the transport sector but the wider economy.
About 80,000 third-country nationals work in the sector and pay more than 700 million euros in taxes annually through Lithuania’s State Tax Inspectorate and Social Insurance Fund, according to alliance head Povilas Drizas.
“If it is not possible to employ at least another 5,000 to 6,000 workers, we can calculate that the state will again lose about 40 million euros in tax revenue,” Drizas said.
Some workers are already being employed through companies established abroad, he insisted, potentially reducing Lithuania’s tax revenue further if the quota is cut.
The Business Confederation has urged the government to review the quota, arguing that the current system does not reflect labour market needs and that existing legislation allows a higher quota than the one set this year.
“There is room to increase the quota,” said Ineta Rizgele, the confederation’s director general.
She argued businesses facing higher taxes and other economic pressures needed government support as the quota had been exhausted unusually early.
Interior Minister Martynas Katelynas opposes an increase, arguing that businesses should make greater use of Lithuania’s domestic workforce.
“Unskilled labour from third countries is a form of social dumping,” Katelynas said, arguing that some employers preferred foreign workers because they could pay lower wages.
The quota does not apply to workers whose employers pay them more than 1,750 euros net per month, he said, questioning whether some companies are addressing genuine labour shortages or simply seeking cheaper workers.
Rita Karavaitiene, head of communications at the Employment Service, said Lithuania nonetheless faced significant labour shortages because of its aging population and demographic trends.
More than 168,000 third-country nationals currently work in Lithuania. About half are employed in transport, one-fifth in construction and one-tenth in manufacturing.
Ukrainians and Belarusians make up the largest groups, followed by citizens of Uzbekistan, Tajikistan and India. The number of workers arriving from the Philippines is growing particularly rapidly.
About 80% of third-country nationals working in Lithuania are classified as medium-skilled workers. (LRT)