The State and the Labour Market Segmentation in Bulgaria – What Do the Results of the Implementation of the 60/40 Measure Reveal?

Abstract

Since the COVID-19 outbreak, Bulgaria has mobilized significant financial resources to overcome the consequences of the pandemic on the economy, labour market and household wellbeing. The 60/40 measure, under which employers from affected sectors can receive financial support to retain existing jobs, became a significant element of these efforts. With a budget of almost 2 billion BGN, the measure supported the retention of over 340 000 jobs. From a research point of view, however, its social impacts, including on labour market inequalities, remain insufficiently clear. This paper tries to contribute to the fulfillment of this gap by putting the results of the implementation of the 60/40 measure in the context of the problem about the labour market segmentation. Based on freely accessible data published by state institutions, the paper discusses the existence of some disbalances linked to the implementation of the 60/40 measure which could deepen the labour market inequalities and expand the segment of jobs with worsening wage adequacy. In that regard, areas of future research and possible improvements of the approach towards the study of the impacts of the measure have been identified. Moreover, the discussed problem areas shed light on some aspects regarding the role of the state and public policies in shaping the labour market segmentation in Bulgaria.