July, 4-5, 2014, Krakow The Human Capital a Potentiality or a Potential Risk for the Romania's Rural Areas Monica Mihaela TUDOR, Cecilia ALEXANDRI Romanian Academy Institute of Agricultural Economics Bucharest „Europejski Fundusz Rolny na rzecz Rozwoju Obszarów Wiejskich: Europa inwestująca w obszary wiejskie.” Projekt opracowany przez Ministerstwo Rolnictwa i Rozwoju Wsi Projekt współfinansowany ze środków Unii Europejskiej w ramach Pomocy Technicznej Programu Rozwoju Obszarów Wiejskich na lata Instytucja Zarządzająca Programem Rozwoju Obszarów Wiejskich na lata Minister Rolnictwa i Rozwoju Wsi

July, 4-5, 2014, Krakow Content I.Brief overview of post-communist transformations in rural Romania II.Human capital in rural Romania -demographic aspects -educational aspects -labour market and young generation involvement in rural Romania III. Farm management in rural Romania -age structure -agricultural training level -performance of farm managers according to their age IV. Conclusions

July, 4-5, 2014, Krakow Methodological note “RURAL AREAS” = rural communities as local administrative units with status of villages

July, 4-5, 2014, Krakow I.Brief overview of post-communist transformations in rural Romania

July, 4-5, 2014, Krakow Romanian agriculture and rural area at a glance post-communist socio-economic environment - reconstitution of the private ownership on the agricultural land - the restructuring of the other sectors of national economy - lack of non-agricultural occupational opportunities in the rural areaeffects -rural area and agriculture became the main absorber of the shocks generated by the restructuring of overall economy (Urban→Rural migration) - private land ownership being one of the main means to meet the subsistence needs of the rural household members  Romanian rural area and the land ownership become a “social buffer” for more than 40% of the Romania’s population  holdings under 5 ha: 93% of the total no. of holdings  ≈ 80% of holdings: - economic size < € / year - use for their own consumption, more than a half of their own farm production - use for their own consumption, more than a half of their own farm production

July, 4-5, 2014, Krakow II. Rural human capital - demographic aspects -

July, 4-5, 2014, Krakow Internal migration The migration flows from urban to rural are more intense than those from rural to urban ▼ > 45% is rural population Evolution of the rural population share in Romania

July, 4-5, 2014, Krakow The evolution of the rural demography in Romania Ageing of Romanian rural population: from demographic point of view ageing of the active population in the future, Romania is likely to face a significant shortage of manpower on rural areas

July, 4-5, 2014, Krakow Evolution of active rural population by age categories in the last ten years declining Importance of the younger generations (15-34 years old) in the active labor force is declining in Romanian rural areas with major negative consequences to the future labour force disponibility

July, 4-5, 2014, Krakow II. Rural human capital - education -

July, 4-5, 2014, Krakow Changes in the educational structure of the rural population aged 15 years and over educational level of the rural population tends to improve ? this improvement is due to the younger generation? ≤8 years of schooling ≤ High school > High school

July, 4-5, 2014, Krakow Educational structure of rural population (2) 15 – 24 years old 25 – 34 years old Rural younger generations are becoming less and less interested to graduate secondary and higher education levels

July, 4-5, 2014, Krakow Educational structure of rural population (3) 35 – 49 years old 50 – 64 years old older generations are better educated than younger generation

July, 4-5, 2014, Krakow II. Rural human capital involvement to the labour force market

July, 4-5, 2014, Krakow Activity and employment rates Rural Romania EU area

July, 4-5, 2014, Krakow (15 – 24 years old) Activity and employment rates by age groups (15 – 24 years old) Rural Romania EU area

July, 4-5, 2014, Krakow (25 – 34 years old) Activity and employment rates by age groups (25 – 34 years old) Rural Romania EU area

July, 4-5, 2014, Krakow Circulatory migration for work in rural Romania Share of persons temporarily absent for work and business in rural active population by age groups, 2011 circulatory migration phenomenon for work (in Romania and abroad) results in a significant decrease of the young active population that effectively supports the labour force supply in rural area out of the young active rural population aged less than 35 years, 11% are temporarily absent being either involved in occupational arrangements in the towns or abroad, or looking for a job or left for business

July, 4-5, 2014, Krakow Structure of rural employment by age and main activity sectors in Romania 68.3% 62.6% 59.9% 60.3% % of agriculture in rural employment -60% of rural labour force is (under)employed in agriculture the average number of days effectively worked in agriculture by a person employed in this sector is 47 days/person/year (Agricultural censuses 2010) - most of them perform agricultural work in their own household ≈ 20% of them are employees with an employment contract, but only 1% are permanent employees

July, 4-5, 2014, Krakow III. Farm management in rural Romania

July, 4-5, 2014, Krakow Main parameters of agricultural farms by managers’ age ( ) No. of farmsUtilised Agricultural Area Contribution to Standard output

July, 4-5, 2014, Krakow Romanian farm managers’ agricultural training level by age, new farmers, although young, have a lower level of agricultural training than those who have retired from farming ▼ negative impact upon the educational structure of farm managers and their performance

July, 4-5, 2014, Krakow Performance of young and elderly managers in Romanian agriculture, 2010 average Romanian farm = 100

July, 4-5, 2014, Krakow ConclusionsPotentiality Romanian rural areas are still populated (45% of the population lives in villages) educational level of the rural population tends to improve values of activity and employment rates are close to EU countries Potential risks aging of rural population → risk of depopulation aging of labour force → negative impact to the future labour force disponibility younger generations are becoming less and less interested to graduate higher education levels trends are decreasing for both indices (particularly affecting the labor market insertion of young generation) 60% of rural labour force is (under)employed in agriculture Rural Human capital

July, 4-5, 2014, Krakow Conclusions Potentiality increasing importance of younger farmers in Romanian agriculture young farmers perform better than older ones Potential risks most new young managers have only practical experience in agriculture → may adversely impact on economic performance of their farms Farm management in rural Romania

July, 4-5, 2014, Krakow Final remarks encouraging and supporting rural youth to graduate higher forms of education supporting labor market insertion of young generation through: - vocational education - lifelong learning - support to companies that hire young rural people training programs in agriculture that to be accessible even for the managers with less financial resources implementation and put in to action of an agricultural advisory system, that to provide specialized technical assistance to farmers, especially for those that do not have expert knowledge or experience in agriculture

July, 4-5, 2014, Krakow Thank you for your attention ! Monica Mihaela TUDOR – Cecilia ALEXANDRI –