Wage growth slows in February 2025, employment declines in several sectors

Wages in Slovakia continued to rise in February 2025 across all key economic sectors monitored monthly by the Statistical Office of the Slovak Republic. However, the pace of growth slowed significantly and, in four sectors, failed to keep up with inflation. Employment levels also showed mixed results, increasing in only three sectors while declining in five.

Nominal wages increased year-on-year in all ten sectors, with growth rates ranging from 1.9% in the sale and repair of motor vehicles to 12.8% in the information and communication sector. When adjusted for inflation, real wages rose in six sectors. The highest increase, at 8.7%, was again recorded in information and communication. The lowest real wage growth, just 1%, occurred in industry. Real wage increases between 4% and 5% were seen in the accommodation sector and in food and beverage service activities. In contrast, transportation and storage, selected market services, wholesale, and vehicle-related services saw real wages decline by between 0.7% and 1.8% compared to the same period last year.

Data for the first two months of 2025 show that nominal wages rose year-on-year across all monitored sectors, while real wages increased in nine of them. The highest real wage growth for the period was 5.5% in information and communication, while the only decline was a 0.6% drop in selected market services.

Employment trends in February were mixed. Year-on-year increases were reported in accommodation, retail trade, and selected market services. At the same time, employment declined in five sectors, with the largest drop of 1.9% in industry and the smallest, 1.2%, in information and communication. Employment remained unchanged in construction and in the sale and repair of motor vehicles.

Over the combined period of January and February 2025, employment was higher year-on-year in three sectors, lower in six, and stable in one. The range of change varied from a 2.1% decrease in industry to a 3.3% increase in accommodation.

The data suggests that while wages continue to grow in nominal terms, inflation is eroding gains in several areas. Employment trends remain uneven, with limited growth confined to specific service-based sectors.

Source: SOSR

Poland reports EU’s lowest unemployment rate, but labour market remains cautious

In February 2025, Poland recorded the lowest unemployment rate in the European Union, reaching 2.6%, according to Eurostat data. This marked the first time Poland outperformed the Czech Republic, which had long held the top spot for the lowest joblessness in the bloc. The Czech unemployment rate stood at 2.7%, placing it second, while Malta followed in third with 3.5%.

Poland’s February figure remained unchanged from the previous month, with 466,000 people registered as unemployed. The milestone not only places Poland at the top of the EU ranking but also reflects one of the lowest unemployment rates recorded in the country’s recent history. For comparison, the average unemployment rate in the EU was 5.7%, and in the eurozone, 6.1%.

Despite the record-low unemployment, analysts caution against interpreting the figures as a sign of a booming job market. Labour market experts, including those at Personnel Service, attribute much of the improvement to demographic changes rather than a surge in hiring. With the working-age population gradually shrinking, the labour supply is tightening, contributing to lower unemployment figures even as recruitment activity slows.

Signs of this slowdown were already visible at the end of 2024. According to data from Statistics Poland (GUS), the number of job vacancies continued to decline. At the close of the fourth quarter of 2024, there were around 91,000 vacancies reported by employment offices, 6.3% fewer than in the same period the previous year.

The “Polish Labour Market Barometer,” a survey conducted by Personnel Service, indicates that companies are approaching employment decisions with caution. Only 16% of employers expressed plans to expand their workforce—down 12 percentage points from the previous year. Meanwhile, 17% of businesses anticipate reducing staff, and a majority, 53%, plan to maintain current employment levels. Medium-sized companies are the most likely to consider downsizing, with 25% indicating possible job cuts.

The survey also found that confidence in future business conditions is waning. While 53% of companies expect stability, one-third believe their situation will deteriorate in the near term, compared to 23% a year ago. Only 14% foresee any improvement.

According to Krzysztof Inglot, founder of Personnel Service and a labour market expert, the low unemployment rate is not necessarily the result of a thriving job market but rather the consequence of long-term demographic trends and cautious business sentiment. He notes that although the unemployment figure is encouraging, it does not fully reflect broader labour market conditions. Companies are not actively increasing headcount, but instead focusing on maintaining current employment levels amid ongoing economic uncertainty.

Looking ahead, Inglot emphasises the importance of monitoring not just unemployment statistics, but also data on workforce participation, job availability, and employer hiring plans. These factors, he argues, will provide a clearer picture of the labour market’s health in the months to come.

The data cited comes from a CAWI (Computer Assisted Web Interview) survey conducted by Personnel Service between 20 and 28 January 2025. It included responses from 329 companies of various sizes, offering insights into employer attitudes during a period of both low unemployment and growing caution.

Source: Personal Service

EU exports of medicinal and pharmaceutical products rise by 13.5% in 2024

In 2024, the European Union recorded a significant increase in exports of medicinal and pharmaceutical products, rising by 13.5% compared to the previous year. According to Eurostat data, total exports in this category reached €313.4 billion. Imports showed only a slight increase of 0.5%, amounting to €119.7 billion.

As a result, the EU registered a record trade surplus of €193.6 billion in medicinal and pharmaceutical products—the highest level to date.

Germany remained the EU’s leading exporter to non-EU countries in this sector, with exports valued at €67.9 billion. Ireland followed with €56.6 billion, and Belgium with €41.4 billion. On the import side, Germany also topped the list of largest importers from non-EU countries (€23.0 billion), followed by Belgium (€21.3 billion) and the Netherlands (€14.7 billion).

The United States was the largest recipient of EU medicinal and pharmaceutical exports in 2024, accounting for 38.2% of exports to non-EU countries, or €119.8 billion. Switzerland and the United Kingdom followed with €51.3 billion (16.4%) and €18.2 billion (5.8%), respectively.

Imports into the EU largely came from the same three partners. The United States was the top supplier, contributing 38.3% of imports (€45.9 billion), followed by Switzerland with 32.6% (€39.1 billion) and the United Kingdom with 7.3% (€8.7 billion).

The data underscore the EU’s continued strength in the global pharmaceutical market, driven by high-value exports and a relatively moderate level of imports.

Source: EUROSTAT

Poland marks 85th anniversary of Katyn massacre with call for strength and solidarity

During the central ceremony commemorating the 85th anniversary of the Katyn Massacre, Prime Minister Donald Tusk paid tribute to the victims and used the occasion to reflect on current threats to peace and security. Speaking at the Katyn Museum in Warsaw, Tusk drew a connection between the atrocities of the past and the dangers facing Europe today, referencing a Russian missile strike on the Ukrainian city of Sumy that occurred just hours earlier.

Established in 2007 as the official Day of Remembrance for the Victims of the Katyn Crime, 13 April serves as a national moment to honour the memory of more than 22,000 Polish citizens murdered in 1940 by the Soviet NKVD. Speaking at the Warsaw Citadel, Tusk stressed that the tragedy of Katyn remains not only a chapter in history but a powerful warning that echoes into the present.

He reflected on the cruelty and injustice of the massacre, calling it a crime that defies understanding. The truth about the massacre was hidden by Soviet authorities for decades and only acknowledged in 1992 following years of pressure from Poland. Tusk emphasized that the evil which led to Katyn is not confined to the past, pointing to the missile attack on Sumy as a modern example of the same forces at work.

“In the streets of Sumy today, we again see death caused by the same kind of evil,” Tusk said, underlining that the mechanisms of violence and lies remain unchanged, and that the lessons of Katyn must guide Poland’s response to aggression and propaganda.

Reflecting on the silence that followed the massacre and the efforts of wartime leaders like Prime Minister Władysław Sikorski to resist diplomatic pressure to downplay the events, Tusk reiterated that Poland must never again be silenced. He declared that the country would not hesitate to speak the truth about its history or current threats and that it would always stand against falsehoods and manipulation.

Tusk also offered a firm declaration that Poland would never again face such threats alone. He emphasized that the country is committed to maintaining strength and resilience, supported by international alliances, and that no one should believe Poland can be threatened without consequence. The government, he said, is investing significantly in defence to ensure the country is prepared for any challenge.

“We must promise those who gave their lives that Poland will never again stand alone in the face of evil,” Tusk stated, concluding his remarks with a call for unity, justice, and determination. The memory of Katyn, he added, is not only a solemn tribute to the past but a foundation for building a secure and vigilant future.

As Poland reflects on this painful chapter of its history, the commemoration serves as both a warning and a commitment: that truth, strength, and solidarity will remain central in protecting the nation’s values and its people.

Source:

Czech Republic sees modest population growth in 2024, lowest birth rate on record

The population of the Czech Republic increased by 8,900 people in 2024, reaching 10,909,500 by the end of the year. This growth was driven by international migration, which added 36,800 residents, while the country continued to experience natural population decline for the sixth consecutive year. The natural decrease, caused by the number of deaths exceeding the number of births, amounted to 27,900.

The total number of deaths reached 112,200, a slight decrease from the previous year. However, the most notable demographic shift was a significant drop in the number of births. In 2024, there were 84,311 live births — the lowest annual figure ever recorded in the Czech Republic, surpassing the previous low from 1999. This marked the third consecutive year of decline, with births down 8% from 2023. The decline affected all birth orders, including first-borns (down 9%), second-borns (down 7%), and third or higher-order births (down 5%). The fertility rate fell to 1.37 children per woman, a decrease from the previous year, and 47% of children were born outside of marriage.

Deaths remained concentrated among older age groups, with the largest numbers occurring among those aged 75–84. January and December saw the highest monthly death totals, while June had the fewest. Life expectancy continued to improve modestly, with a slight year-on-year increase for both men and women.

Marriage rates declined for the second year in a row. In 2024, 44,500 couples were married, a drop of 3,800 or 8% from the previous year. The decline was evident across all age groups between 25 and 50. The most common age for marriage was among those born in 1993. Meanwhile, divorces increased, with 20,800 couples separating, up 7% from the previous year. The total divorce rate rose slightly to 40%, with most divorces occurring after 4 to 7 years of marriage. More than half of these divorces involved minor children, affecting a total of 19,300 children.

International migration remained the main source of population growth. While the number of immigrants decreased by 19,400 compared to 2023, the total still reached 121,800—significantly higher than pre-war levels. The number of people leaving the country increased sharply, with nearly 85,000 registered emigrants, up 38,400 from the previous year. A large proportion of these were individuals whose temporary protection had expired.

Despite a slight overall population increase, the demographic trends in 2024 reflect continued challenges for the Czech Republic, including declining birth rates, an ageing population, and a reliance on migration to offset natural population losses.

Source: CSO

Regional economies in Poland show mixed performance in late 2024

Statistics Poland has released its latest regional report on the socio-economic situation of voivodships for the fourth quarter of 2024. The data indicate both positive and negative developments across key sectors including GDP, labour markets, wages, agriculture, and industry.

Gross domestic product (GDP) in the final quarter of 2024 grew by 3.2% year-on-year in real terms, driven primarily by domestic demand. The contribution from household and public consumption, along with inventory accumulation, supported this growth. However, net exports continued to negatively affect overall economic performance.

Gross value added (GVA) across the economy increased by 2.1%. The most notable annual growth occurred in the financial and insurance sectors (+6.4%), transportation and storage (+5.8%), and professional and technical activities (+5.3%). Construction was the only major sector to experience a decline, falling by 7.7%.

In the labour market, the average number of employees in the business sector decreased by 0.4% compared to 2023, with job losses reported in 11 out of 16 voivodships. Registered unemployment remained steady at 5.1%, though regional variation persisted, ranging from 3.0% in Wielkopolskie to 8.7% in Podkarpackie. The number of registered unemployed individuals under 30 and over 50 also declined slightly.

The average gross monthly wage in the enterprise sector rose by 11.0% in 2024. Świętokrzyskie recorded the highest wage growth (+16.0%), while Śląskie reported the lowest (+9.4%). Despite the wage increases, disparities across regions persisted, although the gap between the highest and lowest earners narrowed.

Agricultural output rose by 2.2% compared to the previous year, largely due to a 5.2% increase in animal production. Crop production declined by 1.1%. Prices for cereals, beef, and milk increased year-on-year, while pork prices fell. Livestock numbers decreased in most voivodships, except for a few such as Łódzkie and Mazowieckie.

In industry, sold production rose slightly by 0.3%, reversing the 1.5% decline seen in 2023. Mazowieckie led growth with a 6.6% increase. Meanwhile, construction and assembly production dropped by 7.7%, a sharp contrast to the previous year’s 4.9% growth.

Inflation eased in 2024, with consumer prices rising on average by 3.6%, down significantly from 2023. Prices for food and non-alcoholic beverages grew at a much slower pace (3.3% compared to 15.1% in 2023), and transport costs fell across all regions.

Financial results of non-financial enterprises deteriorated, with net profits falling by 24.3% year-on-year. The decline was driven by slower revenue growth compared to rising costs. Profitability ratios worsened across most voivodships, although some improvement was observed in Lubelskie, Małopolskie, and Podkarpackie.

Investment outlays by non-financial companies declined by 7.8% at constant prices, following a strong 10.2% growth in 2023. Fewer investments were made in buildings and structures, although more new projects were launched compared to the previous year.

Overall, the report reflects a stabilising economy with signs of recovery in some areas, particularly consumption and wages, tempered by weaknesses in construction and business profitability. Labour market dynamics remained uneven, and regional disparities in employment and economic output continue to persist.

Older workers prioritise stability over change amid labour market challenges

Poles aged 55 and over are demonstrating a strong attachment to job stability, according to the latest edition of the “Polish Labour Market Barometer” by Personnel Service. While nearly half of respondents in this age group evaluate their professional situation positively, only a small percentage believe that 2025 will bring improvements. Most do not intend to change jobs, though a significant number are still planning to seek pay increases.

The survey shows that 50% of workers aged 55+ describe their current work situation as good or very good, with another 35% rating it as neutral. Only 11% reported dissatisfaction with their position. However, when asked about expectations for the coming year, just 2% expressed optimism—marking the lowest level of confidence among all age groups surveyed. Most, 66%, expect no change in their employment situation, and 13% fear it could worsen.

Plans for the future reflect this cautious outlook. While 24% of older workers intend to request a raise, just 9% plan to take a course to improve qualifications, and 12% are considering a move to a higher-paying job. Notably, 29% of respondents said they would not take any steps toward increasing their earnings. Additionally, 73% of those aged 55 and over do not plan to change jobs within the next six months, and only 8% are actively considering new employment opportunities.

The main reasons older workers choose to stay in their current roles include job security, cited by 70% of respondents, followed by a positive work environment (50%) and salary (41%). These results suggest that non-financial factors, such as interpersonal relationships and a sense of stability, are as important as income for many in this demographic.

According to data from the Social Insurance Institution (ZUS), the number of working retirees is steadily rising. By the end of 2024, there were 872,600 retirees still employed—half the number recorded in 2015. Labour market expert and Personnel Service founder Krzysztof Inglot considers this trend encouraging, particularly in the context of Poland’s ageing population and workforce shortages.

Inglot points out, however, that challenges remain. Many employers continue to favour younger candidates, and older workers often perceive limited career prospects for themselves. This dynamic is compounded by lingering age discrimination. Yet with demographic shifts underway, there is growing pressure to retain experienced staff.

He adds that while initiatives like wage subsidies for older workers are promising, broader measures are needed to support their continued employment. One suggestion is offering personal income tax relief for workers over the age of 55, similar to existing incentives for those under 26. Such reforms, Inglot argues, would not only benefit individual workers but also strengthen the broader economy by preserving knowledge and ensuring generational continuity in the labour market.

The survey was conducted using the CAWI method on the Ariadna research panel in January 2025. Responses were collected from a national sample of companies and workers, providing insight into the current sentiments and expectations of older employees across Poland.

Source: Personal Service

Czech commercial real estate investment hits five-year high in early 2025

Investment in Czech commercial real estate reached its highest level since early 2020 during the first quarter of this year, totalling CZK 37 billion (EUR 1.47 billion). This figure represents a threefold increase compared to the same period in 2024, according to an analysis conducted by real estate consultancy Knight Frank.

Domestic investors played a key role in driving this growth, while U.S.-based capital also accounted for a significant share of activity, representing one-third of the total volume. Much of this was attributed to a large-scale acquisition by the American investment firm Blackstone.

The largest share of investment was directed toward industrial and warehouse properties, which accounted for 25% of total volume. Multifunctional buildings followed closely with a 24% share, while hotels made up 23%.

One of the quarter’s most notable transactions was Blackstone’s acquisition of CT Real Estate, a portfolio comprising ten logistics parks, seven of which are located in the Czech Republic. Blackstone is also in the process of acquiring a majority stake in Contera’s industrial property portfolio. Knight Frank analysts view these moves as evidence of the continued appeal of the Czech real estate market to foreign investors.

The hospitality sector also recorded a significant transaction, with PPF Hospitality acquiring the Hilton Prague Hotel. Knight Frank interprets this as a signal of investor confidence in the recovery of tourism and the stability of revenues in the hospitality sector.

Other prominent transactions during the quarter included Redstone’s acquisition of the Atrium Flora and Myslbek retail and office complexes in Prague. These multifunctional buildings, which blend commercial and office uses, are viewed as attractive investment options due to their ability to diversify real estate portfolios.

According to Josef Karas, Investment Manager at Knight Frank, further growth is expected in the office property segment throughout 2025. He noted that local capital, particularly from domestic real estate funds, is likely to continue driving demand, supported by the Czech National Bank’s recent decision to reduce the repo rate. Karas also highlighted ongoing interest from international investors, especially in the industrial and logistics sectors.

Revenue yields across most segments remained stable quarter-on-quarter. The exception was in prime office buildings and retail properties located on high streets, where yields declined by 0.25 percentage points. Currently, yields average 5.25% for office properties, 6.00% for shopping malls and retail parks, 4.50% for high-street retail and rental apartments, and 5.00% for industrial and logistics assets.

Knight Frank’s findings suggest that the Czech commercial real estate market is gaining momentum, with a mix of local and international capital showing renewed confidence across key segments.

Source: CTK

Czech mortgage market sees strong growth in March, driven by lower rates and bank offers

Mortgage lending in the Czech Republic gained momentum in March as banks and building societies issued loans worth CZK 32.8 billion, marking a 29 percent increase compared to February. New loans excluding refinancing reached CZK 27.2 billion, also showing similar growth. The figures come from the Czech Banking Association’s Hypomonitor report, which includes data from all institutions active in the mortgage market.

The rise in mortgage activity was supported by promotional offers launched in February by several banks, with most contracts signed in March. According to Ondřej Šuchman, mortgage manager at Komerční banka, these offers contributed to stronger sales performance. He added that demand for home ownership continues to grow despite only a slight decrease in interest rates.

The number of new mortgages issued in March rose to 6,680, representing a 47 percent increase compared to the same month last year. Refinanced loans, either within the same bank or between institutions, also climbed to CZK 5.7 billion, up 45 percent from the monthly average in 2024.

Interest rates showed a minor decline in March, with the average for new mortgages falling from 4.72 to 4.68 percent. This brought the average rate 0.51 percentage points lower than it was a year earlier. As a result, monthly mortgage payments for an average loan dropped by about CZK 1,200, reducing repayment burdens by around 1.4 percent of net income.

Jaromír Šindel, chief economist at the Czech Banking Association, noted that while the drop in rates is encouraging, inflationary pressure—particularly from services—could influence the Czech National Bank’s approach. He added that if conditions allow, mortgage rates could fall further to around 4.25 percent in the second half of the year.

The average size of newly issued mortgages also grew slightly in March to CZK 4.07 million, an increase of nearly two percent month-on-month and 19 percent higher than a year ago. This reflects the combined effect of rising property prices, higher wages, and gradually easing interest rates.

In historical context, current mortgage rates remain significantly higher than pre-pandemic levels. Compared to an average rate of 2.8 percent in 2019, the refinancing rate of 4.66 percent translates to an increase in monthly payments by over CZK 1,800, roughly 3.8 percent of the average gross wage.

Despite only a modest month-on-month decrease of 0.04 percentage points in rates, analysts are watching closely for further developments. Jan Sadil of the JRD Group commented that recent downward trends in long-term interest rates could impact future mortgage pricing if they continue.

David Krůta, a consultant at 4fin, observed that the market is currently experiencing a typical spring revival, largely supported by promotional campaigns. While interest rates are easing only gradually, he noted that banks are introducing offers focused on three-year fixed rates, which remain the most popular among clients. Some banks have launched spring incentives including free property appraisals, discounts on insurance, and preferential conditions for green loans.

Although uncertainty on global markets continues to limit the pace of rate cuts, current mortgage activity reflects a growing appetite for home financing in an environment of slightly improving affordability.

Source: CTK

EBRD launches tender to attract investors for Moldova’s Giurgiulesti Port

The European Bank for Reconstruction and Development (EBRD) has officially launched an international tender to attract strategic investors for Moldova’s Giurgiulesti International Free Port, the country’s only direct access point to the Danube River and, by extension, international maritime trade routes.

The initiative aims to bring in private-sector expertise and capital to modernize and expand the port’s infrastructure, improve operations, and unlock its full potential as a regional logistics hub. According to the EBRD, the selected investor will take a controlling stake in the company operating the port, subject to regulatory approval and final negotiations.

Located in southern Moldova near the borders with Romania and Ukraine, Giurgiulesti plays a crucial role in the country’s trade connectivity. The port facilitates both imports and exports of goods ranging from agricultural products and fuel to containers and general cargo. With Moldova seeking to strengthen its economic ties with the European Union and diversify its trade routes, the development of Giurgiulesti is seen as strategically important.

The EBRD, which is supporting the process in cooperation with the Moldovan government, has been an active partner in the country’s infrastructure and logistics sectors. By launching this tender, the bank intends to enhance private sector participation and ensure that the port continues to operate efficiently, transparently, and in line with international standards.

The call for expressions of interest is open to qualified investors with experience in port operations and infrastructure development. The EBRD has emphasized that transparency, sustainability, and long-term commitment will be key criteria in the selection process.

Interested parties are invited to submit proposals in the coming weeks, after which a shortlist of candidates will be drawn up. The final selection and transaction structure will be determined in consultation with Moldovan authorities and relevant stakeholders.

The move is expected to attract attention from regional and international logistics operators and infrastructure funds, especially given the increasing importance of the Danube corridor for European supply chains.

Giurgiulesti’s development is part of broader efforts to improve Moldova’s trade infrastructure, reduce dependence on overland routes affected by regional instability, and integrate more deeply with European and global markets.

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