Labor market analysis in 2025: Upward trend in construction, layoffs in automotive and IT
Florin Drăgan conducted an end-of-year analysis of the evolution of the economic environment and the labor market, as well as the outlook for next year, based on dialogue with representatives of the business community and the technology sector. The conclusions show that the economic impact varied from one sector to another. The areas supported by investments from the PNRR (National Recovery and Resilience Plan) experienced relatively stable growth, while sectors dependent on global markets, such as automotive and IT&C, were strongly affected by international tensions and European economic instability.
Automotive industry is going through an „extremely” difficult period
„The automotive industry is going through an extremely difficult period at European level, and this is also felt in Romania. We are talking about a combination of factors that simultaneously affect manufacturers and suppliers: the economic slowdown, falling demand, rising energy and raw material costs, but also the pressure of the transition to electromobility. The investments required for new technologies are very high, and it is difficult to recoup them in an unstable economic context. In addition, increasingly strong competition from China, which benefits from lower costs and a significant lead in the field of electric vehicles, is putting additional pressure on European manufacturers. Added to this are trade tensions and supply chain issues, which are affecting the entire automotive industry in Europe,” said the rector of the Polytechnic University of Timișoara.
In fact, according to his analysis, the automotive and IT&C industries have seen the most layoffs this year, both in Romania and globally.
In the IT sector, competition for entry-level positions has increased considerably. While in previous years companies encountered difficulties in recruitment, the large number of applicants for a single position currently indicates a market that is more favorable to employers.
The rector points out that, in this context, the internship and work experience programs run by the Polytechnic University of Timișoara, including those funded by the EU, have proven essential for integrating young people into the labor market. At the same time, there are areas such as construction, where there is still a shortage of specialists, given the large number of projects currently underway.
AI changed the labor market
„I spoke with the manager of a smaller company, and this fall, a job advertisement received 60 CVs in two hours. This is enormous compared to previous years. In addition to economic challenges, artificial intelligence has also changed the labor market, reducing the number of jobs. In software development, where it is most widely used, a person’s productivity can increase from 50% to more than double. At the same time, with the help of artificial intelligence, we can in some cases rewrite an application in two to three weeks, whereas in the past it took over a year and a team of programmers. There are also maintenance processes that are carried out more quickly, without staff having to master them in detail. So, there is a need in the labor market to readjust the qualifications that a person has when they want to get involved in these areas,” continued Florin Drăgan.
The UPT rector’s analysis shows that opportunities come from investments in digitization, research, and development. Also, the business environment has already gotten used to government measures taken in the last days of the year, with immediate applicability.
„Predictability is what large companies have been asking for for years. We must understand that in the private sector, a budget is not made overnight. In addition to internal instability, companies will be dependent on what happens in the global market. Given that our economy is not based on innovation, exposure to what is happening in other countries is quite high. In fact, we need to invest more in innovation if we want long-term stability, because the results will not come immediately. We should invest in partnerships between companies and universities to generate impactful projects. IPCEI is one of the programs that is quite delayed, but it can show how research should be done in Romania. At the same time, universities can no longer afford to have fields with 30% employability in the labor market. We should establish the fields in which we want to excel and invest in them in particular,” concluded UPT Rector Florin Drăgan.