* Weak eurozone upturn hurts remittances to Balkans, others
* Falloff in remittances seen hitting growth, currencies
* Returning migrants struggle to find jobs at home
By Luiza Ilie
BUCHAREST, May 31 (Reuters) - Eastern Europeans working abroad are sending less money home this year, severing a lifeline for hundreds of small towns and slowing the recovery in some of Europe's poorest emerging economies.
Analysts say exact calculations for how much the slump may shave off GDP across the region are hard to pin down. However, in one of the region's biggest economies, Romania, they make up 3 percent of GDP and fell by a third in the first quarter after a similar drop last year.
Neighbouring Bulgaria has also seen a slide and analysts expect other diasporas to send less funds to Southeast Europe this year.
The trend is an example of how weak recovery in the euro zone will impact poorer eastern European states who depend on remittances, hurting an important growth factor, driving up external imbalances and putting pressure on currencies.
"When I arrived in Spain seven years ago people were knocking on your door at all hours to give you a job," said Cristian Moldovan, 32, who returned to his small central Romanian town of Campina in December.
"Now you're knocking on theirs, but they don't have any."
With unemployment at 20 percent in Spain and 9 percent in Italy, where most Romanian migrants have found jobs, analysts say the fall in remittances would worsen and spread across the region in countries ranging from Albania to Poland.
Returning migrants are also expected to struggle to find jobs in mostly recession-hit countries that must enforce fiscal cuts to address large structural deficits.
"With a falloff in the inflows eastern European migrants send home there are risks to current account deficits and exchange rates," said Eurasia Group analyst Jon Levy.
"More directly, it just means families have diminished purchasing power ... in many cases remittances are probably pretty integral to just the ability to provide housing."
RETURN TO SENDER
Remittances account for roughly 3 percent of gross domestic product in Romania and Bulgaria, and less than half that figure in Poland. But they reach up to 27 percent in smaller countries like Moldova, Bosnia and Albania, meaning their plunge is a real threat to economic growth.
Roughly 800,000 Albanians of the state's 1.2 million emigrants have jobs in Greece, mainly in construction, farming and tourism, the largest number of foreign workers there.
But as the Greek government enforces sharp cuts, leading to violent protests and an expected economic contraction of 4 percent this year, many Albanians are returning home.
For decades Eastern Europeans were driven abroad by dying local industries, ethnic wars and poverty. Their savings helped families back home buy houses and start businesses.
The cash helped strengthen currencies and served as a counterbalance to widening external shortfalls, but it also drove up real estate prices and fuelled an imports-dependent consumption boom that further widened imbalances.
Falling remittances added to woes caused by investor flight at the height of the global financial crisis that prompted Romania, Serbia, Ukraine and others to seek aid from the International Monetary Fund.
The bailout helped stabilise the leu currency
"Funding for a bigger current account deficit will be tighter and more reliant on other, less predictable investment inflows," said Raffaella Tenconi, an economist at Wood&Co.
Tenconi has halved her forecast for net transfers to Romania -- most of which are remittances -- to 2-2.5 billion euros for this year, and said the overall current account gap would grow from last year's roughly 5 billion euros.
UPSIDE
Net remittances to Romania fell from 950 million euros to 620 million euros in the first quarter, adding to a plunge of 35 percent in 2009.
Bulgarian remittances fell 11 percent. Its diaspora of 1 million hold jobs mainly in Greece, Spain and Italy. Other eastern European states have yet to release first-quarter data.
World Bank experts predict global remittances will recover and rise some 6 percent this year to $437 billion due to better world growth prospects. They say Europe and central Asia, which last year had the sharpest drop at 21 percent will also rise.
But analysts warn that recovery in western Europe was unlikely to bring back remittances to levels before the crisis.
Moldovan, who returned in December has found a job as a distributor only three weeks ago. The pay is one tenth of what he made working on farms and at gas stations in Spain and significantly below the unemployment aid he received there.
"There is no comparing here to there," he said. "I don't know if we could ever catch up to them."
For a factbox on remittance details in Southeast Europe please double click on [ID:nLDE64U0JQ] (Reporting by Luiza Ilie; Additional reporting by Benet Koleka in Tirana and Alexander Tanas in Chisinau; Editing by Patrick Graham)