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Skype Estonia: Recruiting From Abroad a Struggle

Source: Photo: Postimees/Scanpix

Immigrant-unfriendly circumstances are hindering Skype Estonia from recruiting IT developers from abroad, according to the company.

The influential brand and internationally attractive employer has had a tough time enticing highly-qualified potential employees to live in Estonia, reported Eesti Ekspress.

Skype Estonia mainly recruits from the Baltics, Russia, Ukraine, Scandinavia and Belarus. But 70 percent of its developers in Estonia are locals.

It is especially difficult to recruit employees from outside of the EU or ones who have families. Some barriers, according to Skype Estonia director Tiit Paananen, include a lack of job opportunities for the partners of employees and finding schools for their children. Estonia only has one school providing an English-language education for all grades and tuition there costs 16,000 euros annually.

"In order to bring mid-level managers here, we need to offer a certain quality of life for the whole family," said Paananen.

Another disincentive, he said, are recent tax reforms, particularly regarding the fringe benefits tax. An employer covering the schooling costs of an employee's children, for instance, must pay tax on the benefit.

Also, if a company offers an employer shares at a discounted rate, the sum of the discount can be taxed by up to 68 percent, according Eesti Ekspress.

From Skype's rapid growth period of 2005-2006 until 2009, its Estonia office remained its main development center. But in recent years the Silicon Valley branch has grown the most quickly, followed by the London branch - previously the business end of the operation. Other development branches are located in Stockholm, New York, Moscow and Prague.

As of July, about a third of Skype's 800 developers were located in Tallinn. So far this year, the company has hired 54 new developers in Tallinn, 13 of which were brought in from abroad, eight from outside of the EU. The company, which was acquired by Microsoft last year, had planned to recruit 80 new developers for its Estonian offices and 300 for its other offices in 2012.


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