Published: November 15 2023
The latest survey conducted by the German-Hungarian Chamber of Industry and Commerce (DUIHK) reveals a pessimistic economic outlook for Budapest. The survey indicates that fewer companies are planning to invest or hire new employees, signaling a decline in business sentiment.
Decreased Plans for Investments
According to the survey, a significant portion (37 percent) of the surveyed companies plan to reduce their capital expenditures, while only 25 percent plan to increase their investments. This marks the first time in ten years that the number of companies planning to spend less on investments surpasses those planning to increase spending.
Deteriorating Business Situation
The survey highlights that 34 percent of the companies expect their own business situation to worsen, while only 18 percent anticipate improvement. This is in contrast to the previous survey conducted in the spring, where 28 percent expected improvement and 26 percent expected deterioration.
Reduction in Hiring Plans
For the first time in a decade, the percentage of companies planning layoffs (21 percent) exceeds the percentage of companies planning to hire new employees (18 percent). The reasons cited for this shift include weakening demand, a shortage of trained workers, and higher labor costs.
Business Risks Faced by Companies
The survey also revealed that companies identified weakening demand, the shortage of trained workers, and higher labor costs as the key risks they are currently facing. These factors contribute to the overall pessimistic outlook expressed by the surveyed businesses.
Source: MTI
Questions & Answers
What does the latest survey of business sentiment in Budapest show? The latest survey conducted by the German-Hungarian Chamber of Industry and Commerce (DUIHK) shows that fewer companies in Budapest have plans to invest or expand their payroll.
How many companies expected their own business situation to worsen according to the survey? According to the survey, 34 percent of companies expected their own business situation to worsen.
How many companies expected improvement in their business situation? Only 18 percent of companies expected improvement in their business situation.
What percentage of companies planned to cut back on capital expenditures? Around 37 percent of companies said they planned to cut back on capital expenditures.
What percentage of companies signaled growing CAPEX? Just 25 percent of companies signaled growing CAPEX.
Has the ratio of companies planning to spend less on investments exceeded those boosting spending before? Yes, according to DUIHK, the ratio of companies planning to spend less on investments has exceeded that of businesses boosting spending for the first time in ten years.
For the first time in a decade, which share of companies exceeded the other - layoffs or new hires? For the first time in a decade, the share of companies planning layoffs (21 percent) exceeded the share that planned new hires (18 percent).
What were some of the business risks mentioned by companies in the survey? Companies mentioned weakening demand, the shortage of trained workers, and higher labor costs as some of the business risks they face.
