The social dialogue and industrial relations in Bulgaria are developing in an unfavorable environment. A trend towards decentralisation of collective bargaining and abandoning the practice of extending the branch collective agreements is observed. All these developments are gradually diminishing the collective bargaining coverage.
New income policy with catching effect can be achieved not just on the base of economic growth but also through increasing role of the state in the distribution and redistribution of the product created. The fight against poverty and social exclusion goes both through a higher quantity and quality employment and also through more equitable taxation and improved social and solidarity systems.
Social effects of the new economic governance and the European semester are apparent. The restrictive policies adversely affect the ability to exit the economic crisis and employment recovery. Stimulating consumption and investment activity are the main prerequisites for ensuring a new type of growth.
"The economy of supply" imposed in Bulgaria through historically low tax rates, a flat tax and consistent reduction of social security contributions, exhausted its possibilities without ensuring economic prosperity, adequate employment and better living standards. Instead, the processes of social stratification and income inequalities deepened.