SEB CFO survey: Labour costs are the largest challenge for companies throughout the Baltics
The survey conducted in October by SEB among CFOs of major Baltic companies shows that the increasingly growing labour costs are the most serious problem in Lithuania and Estonia. In the conditions of record-high employment, Estonian businesses have more difficulties finding enough qualified workforce compared to the other Baltic neighbours.
In this year’s survey, labour costs are, for the first time, the most important concern in all three Baltic states. Increasing personnel costs seem to be the most serious problem in Lithuania, where 64% of businesses highlighted the issue, followed by Estonia and Latvia with 60% and 47%, respectively.
Companies lack workforce
In addition to high labour costs, employers are constantly troubled by the lack of skilled workers. Estonian companies face the most difficulties in finding qualified workforce; almost half of the respondents (49%) highlighted this problem. This is also not surprising, considering the fact that the Estonian employment rate has been among the highest in the European Union for several years already.
“Years of deficit of skilled workforce, in combination with a constant and general increase of labour costs has put most companies in a situation where they need to automate even more intensely, or radically change their business models. At the same time, automation and innovation are not magic wands, and making one’s business more effective requires a multi-faceted approach. At that, the willingness to hire foreign labour has remained unchanged compared to the previous year – 40% of major companies have already hired, or are looking to hire workforce from abroad, and 60% intend to get by with local workforce in the future as well,” added the Head of Corporate Banking Artjom Sokolov.
The scarcity of labour is also a big concern for Lithuanian companies, 64% of whom reported it as a serious issue; Latvians are a little less worried about this (47%). At the same time, Latvia currently has the lowest employment rate in the Baltics, and the highest unemployment rate.
SEB organised the Survey of CFOs in the Baltic Republics for the seventh time. The focus of the survey is the assessment of enterprises concerning the state of the economy, key problems, and opportunities in the business environment. This year, a total of 209 enterprises, each with a minimum annual turnover of at least EUR 20 million, participated in the survey.
