Why aren’t there more programmers in Banja Luka

I recently talked to a friend working in IT sector in Banja Luka and I thought I could write a few fresh insights.

Situation in IT sector in Banja Luka Region is similar to other sectors regarding labor – we don’t have enough workers. Just like in other sectors, this is one of the main obstacles for further development of local IT firms. I’m not sure if it’s identified as a main obstacle by now, but if it’s not – it will be.

We were talking about how programmers become programmers. Apparently, in this sector formal education is not needed as much as in other sectors, at least if you are planning to get a job in small or medium enterprise (unlike public sector or big companies or banks, etc). Most people don’t have formal education anyways. Former car mechanics, graduated geographers, people with secondary education, etc. are very often in IT SMEs. Most of them didn’t participate in any kind of courses – they learned all they know by studying .pdf tutorials and watching YouTube, and during practical work. He was joking that best friend of anyone trying to master programming is “how to” combined with Google. When seniors advise newcomers, they usually tell them not to waste money on commercial courses when everything is available online, for free.

I was very curious how long would I need to study these tutorials in order to be able to find a job in Banja Luka. Answer was 3-6 months, depending of how serious I am. I was surprised to hear that after 3 months of serious work, employers would actually consider employing me. Employers, naturally, need seniors, but seems that they are aware that they can’t afford and find them. So employers have lowered their criterion. I have found out that employers generally care about discipline and elementary logic. Programming is something that can be learned.

So, I wondered, why aren’t there more people starting to learn programming? Answer didn’t surprise me: it’s because of biases. People see programming as advanced mathematics, or perhaps nuclear physics – something hard to understand and unreachable. And it’s not. Former car mechanic, now self-taught programmer with minimal knowledge of mathematics, is successfully doing it.

From my experience, this is not the only answer, but for the beginning – it sounds IT-specific enough.

 

Enterprises in Banja Luka Region mostly need workers with low level of knowledge and skills

It is possible to find a news article with lists of unemployed persons sorted by professions. But I don’t remember I ever found similar list of workers required by enterprises, sorted by professions.

I got a chance to make such list for region of Banja Luka on Job Fair in June 2017. I’m aware that not all enterprises which are looking for workers were present on this Job Fair, but I believe that based on those that were present a rough image can be formed on what professions are needed by domestic enterprises.

Enterprises from Banja Luka and neighboring municipalities (Čelinac, Gradiška, Kotor Varoš and Prnjavor) were present and they were in search for almost 800 workers.

It is evident that nearly half of workers are required by textile and shoe wear industry, and that they need workers in production. Requirements for employment in these enterprises are low. Candidates are only required to have elementary school diploma, which means non-qualified workers can apply. Low level of needed skills and knowledge for work in these positions conditioned very low salaries (minimal salary, ~200 EUR). This shouldn’t surprise anyone, since textile and shoe wear industry products are made in the same way in Germany, Turkey, India and here, which means enterprises in this industry need to offer lower price to be competitive. That’s why they need to make savings in production, and the most effective way to make those savings are low salaries for workers. To conclude, enterprises in this industry offer plenty of jobs, but those jobs are, conditionally speaking, not quality ones.

For easier analysis, in further text I will ignore this industry and analyze rest of required workers.

When we ignore workers required by textile and footwear industry, most of required workers are non-qualified workers with only elementary school finished. They are mostly required by construction companies: construction carpenter, armature workers, masons, electrical installers. Then there are Mechanical engineers (first profession with Faculty education) – 19 of them. Out of mechanical professions, mechanical technicians, welders and locksmiths are also needed. Leather technicians, carpenters, sellers, whitesmiths, tip truck drivers are also needed, about 10 for each profession.

I was surprised to see small number of required CNC operators (7), since I often hear in enterprises they’re always in pursuit for them.

It’s interesting to highlight number of needed engineers, total 28. 19 mechanical engineers, 8 electrical engineers and one geoinformatics engineer. Number of needed architects is 5 and number of economists with Bachelor is only 1. In total, number of professions with Faculty diploma is 34.

Then I grouped professions required by domestic enterprises based on level of knowledge and skills they need to have. This is how I did it:

5 – engineer / Faculty diploma
4 – Technician / Highschool diploma
3 – craftsman
2 – trained worker
1 – non-qualified worker

This is the result:

Hence, enterprises in Banja Luka Region are mostly looking for trained workers (whereby terms for employment are usually minimal, so we can also call them non-qualified workers), 478 of them. With 37 non-qualified workers, we get information that 65% of required workers are those with minimal knowledge and skills. With raise of needed knowledge and skills, demand for these professions is decreasing. Thus, number of needed craftsmen is 199, number of needed technicians is 51 and number of needed professions with faculty education is 37.

Now let’s get back to the beginning and remind ourselves that now all enterprises in Banja Luka and Region were present at Job Fair Banja Luka 2017, so these data should be taken with reserve. But I think that at least they are useful to make these conclusions: Required professions in Banja Luka are mostly those with low level of knowledge and skills. That shows us that economy of Banja Luka Region is not complex enough and that products it makes are relatively simple, because demand for knowledge and skills is low.

From the perspective of enterprises, it means they can’t be competitive with quality, but with low price. From workers’ perspective it means that their knowledge and skills are not needed and that what lefts, and that is their physical work on relatively simple jobs, will be low paid.

PS

Banja Luka Region has 35 000 people on Employment Office’s list of unemployed persons. Yet, during my visit to Job Fair, only about 10 unemployed persons were inside the hall. More employers then unemployed persons. But that’s topic for another blog.

Fastest growing industries in Bosnia and Herzegovina are food related

I have recently read an interesting blog written by Cesar Hidalgo, Trump, forget about Coal and Nuclear, software exports is where the jobs are at. His point was, among others, that state should invest more in growing sectors to provide new jobs. That instantly made sense to me, so I started thinking about what sectors are fastest growing in Bosnia and Herzegovina.

Since data on export from B&H 2013-2016 were recently released, I figured out I could use that to show approximately which sectors are growing fast. Also, I used export data since export-oriented sectors (and enterprises) are also the most competitive and most advanced ones.

First, let’s see how does B&H export treemap looks like in 2016:

Here are a few of my random thoughts about this treemap. It’s interesting that Furniture is #1 export product of B&H (excluding Cork and Wood manufactures), and wood as raw material #4, especially when you know how hard it is for domestic enterprises to get raw wood for their production.
Footwear and wearing apparel enterprises are good for creating a lot of jobs, but these jobs are not well payed since wages are mostly minimal allowed (200€). Those firms are mostly working for partners in EU, without developing their own products.
Metal processing enterprises are usually making parts for their foreign partners and don’t usually have their own final product. Unlike wood processing sector.
Road vehicles are compiled in Sarajevo for Volkswagen.

Now, let’s see which of these are fastest growing in period 2013-2016:

None of these are in top 5, but most of them do have an export growth. Furniture has export growth of 4,5%, Footwear also 4,5%, Manufactures of metal 6,5%, Cork and Wood 4,97%, Road vehicles 5,4%, Iron and Steel -4,2%…

Top 5 – Export Growth

  1. Animal and vegetable oils and fats (29,50% growth)
  2. Chemical materials and products (28,33%)
  3. Travel goods (23,57%)
  4. Meat and meat preparations (22,39%)
  5. Cereals and cereal preparations (17,68%)

What attracted my attention is that 3 of 5 products from top 5 export growth list were food products. So, it seems to me that food industry is the fastest growing industry in Bosnia and Herzegovina, and industry where B&H could create significant number of jobs.

P.S. I am also wondering where is the position of the IT industry in B&H export and how high is it’s growth.