Labor Market Overview

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Labor Market Overview BUSINESS CONNECTIONS SEMI-ANNUAL REPORT FOR MEMBERS 2020 Uzbekistan Labor Market overview From the Editors JOIN US ON SOCIAL MEDIA WWW.AMCHAM.UZ FACEBOOK @amchamuz LINKEDIN American Chamber of Commerce in Uzbekistan INSTAGRAM @chaamerican Dear Members and Friends, When we started to plan this issue of Business Connections none of us anticipated the havoc that COVID-19 has set in motion around the world. Now, it would be hard to find a sector or busi- ness activity that has not been impacted, with no clear idea as to what the “new normal” will be once the pandemic has subsided. With that in mind we have focused this issue on labor and the job/ employment market in Uzbekistan, recognizing that there will be changes and businesses will need to alter their current policies and procedures to fit the new reality. In order to best serve our members during this challenging time, we in AmCham have already shifted our meetings to webinars and video conferencing, knowing that there will be more changes ahead. We wish you all good health and safety. The Editorial Board WWW.AMCHAM.UZ 3 INVITATIONS Exhibitions in Uzbekistan Uzexpocentre, Tashkent 13.05 - 15.05 10.09 - 12.09 21.10 - 23.10 OIL&GAS UZBEKISTAN 2020 UZTEXTILE EXPO UZSTROYEXPO 2020 ITECA ITECA IEG Uzbekistan 13.05 - 15.05 17.09 - 19.09 21.10 - 23.10 POWER UZBEKISTAN 2020 UZFOOD 2020 UZENERGYEXPO 2020 ITECA ITECA IEG Uzbekistan 26.08 - 28.08 23.09 - 25.09 21.10 - 23.10 TIHE 2020 UZMEDEXPO 2020 UZSECUREEXPO 2020 ITECA IEG Uzbekistan IEG Uzbekistan 26.08 - 28.08 24.09 - 26.09 04.11 - 06.11 MEBELEXPO UZBEKISTAN 2020 AQUATHERM TASHKENT 2020 MININGMETALS ITECA ITECA UZBEKISTAN 2020 ITECA 26.08 - 28.08 24.09 - 26.09 STOMATOLOGY UZBEKISTAN 2020 SECUREX UZBEKISTAN 2020 04.11 - 06.11 ITECA ITECA TRANSLOGISTICA 2020 ITECA 26.08 - 28.08 07.10 - 09.10 APTEKAEXPO CENTRAL ASIA / PLASTEX UZBEKISTAN 2020 25.11 - 27.11 TECHPHARM 2020 ITECA UZAGROEXPO 2020 ITECA IEG Uzbekistan 07.10 - 09.10 09.09 - 11.09 O`ZUPACK – 25.11 - 27.11 CAITME 2020 O`ZBEKINPRINT 2020 UZPRODEXPO 2020 ITECA ITECA IEG Uzbekistan Business Connections 4 Semi-annual Report for Members 2020 Exhibitions in USA 16.05 - 19.05 26.07 - 30.07 NATIONAL RESTAURANT 2020 AACC ANNUAL SCIENTIFIC ASSOCIATION RESTAURANT, MEETING & CLINICAL LAB EXPO HOTEL-MOTEL SHOW 2020 HEALTHCARE FOOD SERVICE Chicago, IL Chicago, IL 10.08 - 13.08 28.05 - 30.05 WASTEEXPRO 2020 INTERNATIONAL FRANCHISE ENVIRONMENTAL TECHNOLOGIES EXPO 2020 New Orleans, LA FRANCHISING New York City, NY 21.09 - 23.09 08.06 - 12.06 GLOBAL SECURITY EXCHANGE (GSX) 2020 EUROSATORY 2020 SECURITY TECHNOLOGY Atlanta, GA Fort Lauderdale, FL 08.11 - 11.11 23.06 - 25.06 PACK EXPO INTERNATIONAL 2020 FLORIDA INTERNATIONAL MEDICAL PACKAGING EXPO (FIME) 2020 Chicago, IL HEALTHCARE Miami, FL WWW.AMCHAM.UZ 5 FEATURE Labor Market Survey AGE INDICATOR 18-25 y.o. 15,3% 26-32 y.o. 26,7% 33-40 y.o. 38,6% 41-50 y.o. 17,3% Over 50 y.o. 2,1% In April 2020 following the introduction of quarantine measures in Uzbekistan, DaVinci Management Consulting (a member of AmCham Uzbekistan and a leader in management consulting with an emphasis on the development of human Almost half of respondents asserted that over 90% staff are work- I capital), surveyed businesses on measures taken to mitigate ing remotely. This does not, however, include production staff the impact of COVID-19 and optimize business processes and working in the manufacturing sector. It is noteworthy that 55% of human capital management. respondents’ top tier management, and 60% of middle manage- ment, work remotely. Participants of the survey included local and international busi- ness operating in 13 regions of Uzbekistan. Those companies The majority of companies with remote-working staff provided employ between five and 5,000 people, and operate in 20 different either a laptop or desktop computer (84%), with 24% providing sta- sectors. The main sectors of operation included IT, construction tionery, and almost 20% covering home Internet fees. Over 50% of and development, retail, finance (banks, insurance etc.), telecom- employers paid for the cell phone services of employees working munications, consulting, pharmaceuticals, oil and gas, and hos- from home. pitality. The respondents included top and middle management, plus specialists. PAID LEAVE, UNPAID LEAVE, AND REDUCTIONS REMOTE WORK VERSUS OFFICE Just 8.4% of respondents reported that their senior management was on leave, a figure which increased to almost 50% of middle 77.2% of respondents are working remotely, versus 10 % which management, and approximately 47% of non-managerial staff. continue working from the office. Of those remaining, 7.1% of are There were, however, 21% of companies reporting maintaining full on paid leave, and 5.7% are on unpaid leave. operations. Business Connections 6 Semi-annual Report for Members 2020 AFTER THE QUARANTINE WILL YOU WORK REMOTELY? 22,3% 57,8% 19,9% YES NO NOT DECIDED YET SHARE OF STAFF ON REMOTE WORK from 90% to 100% 36% from 70% to 89% 11% from 50% to 69% 21% from 20% to 49% 5% Less than 19% 19% Do not work remotely 8% 0 10 20 30 40 A smaller percentage of staff are on unpaid leave: this breaks down PLANS as 3% of senior management, 22% of middle management, and 43% of non-managerial staff. Over 50% of staff on unpaid leave 77 % of respondents predicted no personnel reduction after the will remain so until the end of the quarantine, with an additional removal of quarantine measures, and in fact, 73% of employers ex- 26% anticipating that their leave will last between one and three pect to recruit new staff. Just over 10 %, however, do not have clear months. personnel strategy at the present time due to uncertainty about the future. Only 1% of respondents reported 20-30% staff reduction, and a further 1% reported 1-5% reduction. It should be noted, though, that current plans may have to change in response to the length of quarantine, and government support No senior managers had been let go, but 2.8% of middle manage- measures for businesses. For any kind of business, planning is the ment and 5.6% of non-managerial workers were made redundant. key to success, and transparency and clear dates for the quarantine period would help businesses plan better. SALARY 62% of respondents asserted they will retain their salary in full. 19% anticipated a 50% salary reduction, and 10% reported they would be paid just 30% of their usual salary. WWW.AMCHAM.UZ 7 FEATURE Olessya Kirilovskaya, Director, Tax & Legal Department Overview of labor and immigration legislation en by the Uzbekistan government has also included changes and INTRODUCTION amendments to the country’s immigration laws. A considerable amount of work has recently been put in to streamline the system As Uzbekistan enters a new stage in its development, large-scale and mechanisms for leaving and entering the country for citizens reforms are being implemented that cover all spheres of state and of Uzbekistan and foreign states and stateless persons, as well as to public life. Over the last few years, starting from 2016, most of the regulate the work of labor authorities. country’s main laws have been amended or are in the process of being amended due to the reforms. The old requirement for citizens of Uzbekistan to receive an exit stamp has been replaced with new biometric passports for The first, and most important amendments, were aimed at traveling abroad. This is one of the most striking examples of this eliminating barriers to doing business, mainly currency, tax and legal transformation and represents a big step towards alignment customs legislation and providing stability guarantees for inves- with international migration norms. Citizens are now free to travel tors – which cover some of the key concerns of the investment abroad with a biometric passport that is valid for 10 years, instead community. of an exit stamp issued for two years. The ongoing reforms have significantly improved the investment In line with the simplified exit requirements, criminal liability for climate of Uzbekistan, which has prompted leading foreign com- foreigners who overstay their visas has been abolished. The fines panies to actively enter the Uzbek market. for people residing in Uzbekistan without proper or deliberately damaged/lost residence permits were also decreased. Opening up borders and modernizing immigration laws are some of the most noticeable reforms enacted in Uzbekistan and have Uzbekistan’s visa-free regime has been extended to citizens of 86 enabled foreign investors interested in the country to visit and countries, including Austria, Spain, the UK, Italy, Norway, Belgium, evaluate opportunities in person. Germany, Italy, Japan, South Korea and others, who can now enter Uzbekistan without a visa for up to 30 days. Consequently, labor and immigration legal issues have become vital for companies wanting to hire local and foreign personnel to Uzbekistan also offers visa free entry without any limitation on support their operations in the country. In this article, we would duration of stay to citizens of Russia, Azerbaijan, Georgia, Belarus, like to discuss these amendments and their impact on the country Kazakhstan, Moldova and Ukraine. Citizens of Kyrgyzstan can stay in more detail. for up to 60 days. IMMIGRATION REFORMS The visa-free regime was initially created to encourage tourism and has proved incredibly successful. The lifting of currency limits Economic theory and international experience show that remov- on travelers, who can now bring in foreign currency without ing barriers to freedom of movement and global connectivity can limitation and take out up to the equivalent of USD 10,000 has also trigger sizeable economic growth.
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