Survey suggests a fifth of Czech companies will introduce layoffs in 2012

For many people 2012 promises to be a tough year or at least one of big changes: a new survey by the Czech Chamber of Commerce has suggested that every fifth company in the Czech Republic is planning layoffs in reaction to the slowing economy – some letting go hundreds, while others will cuts jobs for dozens of employees.

Illustrative photo: Czech Television
A little earlier I spoke to Chamber of Commerce spokesman Petr Kopáček about the situation for companies and why some will have to reduce staff.

“I would say that many Czech firms don’t have enough information about their future and there is great uncertainty: almost a quarter of Czech firms are having trouble gauging whether next year will be better or worse. More than 40 percent though think it will be worse and only nine percent think they will do better.

“Generally speaking, Czech firms are in good condition: the problem is the dependence on export and what is happening on the European markets. More than 80 percent of Czech exports go to European countries, where we now see problems with the eurozone. So Czech firms have to find new markets, Russia and South America, and so on.”

You talk there about export-dependent companies but one of the industries expected to be hardest-hit where there will be layoffs is construction, correct?

“That’s right. There have been pessimistic forecasts for a while: the recession in this year is worse and worse and because of austerity measures there is no new government money in this area, there is a lack of investment and there is a lack of new infrastructure projects. So this sector has been very hard hit.”

With regards to employees losing their jobs, are these more skilled employees or less?

“It’s difficult to gauge the exact proportion but I can say this: firms know there is a greater danger in letting go skilled employees, especially in technical jobs. The Czech employment sector is characterised by several structural problems: on the one hand firms often have trouble finding highly-skilled workers; on the other hand, there are a lot of people less training out of work.

“And this needs to be made more flexible, through government programs pushing requalification and so on. If companies let go highly-trained professionals now, they know they could have a tough time getting them back after conditions improve, so I think that is one aspect firms will have to take into consideration.”