Investment forecasts
According to the findings of the survey for the second half of 2018, 27% of companies say they will not increase investments this year, compared to only 18% at the beginning of the year. We also note that 49% of businesses want to increase their investment by 1%-10% compared to 46% previously, while only 10% of companies say they will increase their investment by 20% to over 30% in the second half of 2018, compared with 15% at the beginning of the year. Most companies in agriculture (33%), those in industrial production (31%) and IT (30%) say they will increase investments by 5%-10% this year.
„The research on ‘The Business Evolution in Romania’ is a tool for dialogue with the business environment. The results of this survey capture the dynamics of top executives’ perception by adding the results of each edition. In the second half of 2018, we find a further decline in the confidence that the main business indicators will have a favorable evolution. With some exceptions, industries such as industrial production, IT, trade, services, agriculture are in line with the general trend. Confidence in favorable developments is declining in the second half of 2018. This year, companies are betting on smaller turnover, profit, or investment growth”, says Elena Badea, Managing Director, Valoria.
Number of employee forecasts
In the second half of 2018, 40% of Romanian companies said they will not change the number of employees this year compared to 24% at the beginning of the year. At the same time, only 43% of companies compared to 63% previously say they expect their staff to grow this year. Moreover, 17% of companies expect their number of employees to decline in the second half of 2018, compared to 13% in the first half.
From an industry sector perspective, 31% of industrial production firms, 29% in professional services, 28% in retail and wholesale trade, 17% in agriculture say they will increase the number of employees between 1%-5% in 2018.
Wages forecasts
If at the beginning of 2018, 17% of companies said they would not make wage increases, in the second half the percentage rose to 29%. The percentage of companies that say they will raise wages by 1%-5% in 2018 drops by 4pp, as compared to the previous semester. Adjustments are also found for companies expecting salaries to grow by 5%-10% (-6pp) and those expecting salary increases of 10%-20% (-4pp). The industries sectors that estimate the most significant increase in wages are: 23% of industrial production firms, 22% of IT firms and 22% of companies in agriculture that are targeting a 10%-20% wage increases.
Top 5 challenges and opportunities
The most important challenges for companies in the second half of 2018 compared to the first half of the year are the following: labor shortage (61% vs. 59%), productivity growth (48% vs. 37%), increased costs (41% vs 21%), employee motivation (37% vs. 25%) and tax changes (21% vs. 62%).
The most important opportunities for companies in the second half of 2018 compared to the first half of the year are the following: economic growth (60% vs. 72%), growth in consumption (69%), growth in exports and the opening of other markets (45% vs. 52%), digitization and online opportunities (40% vs. 41%) and European funds for SMEs (29% vs. 36%).
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