Which industries in Czechia will raise wages in 2023?

This year employers plan to hire more workers than they fire, and many firms will raise wages. But those who perform routine activities for low wages could face difficulties this year, a survey of Czech companies revealed.

Firms with 50 or more workers want to recruit this year, while the smaller employers, those with only up to 10 workers, are more likely to lay off, a survey conducted for the Ministry of Labor and Social Affairs in cooperation with recruitment firm LMC shows. The survey took place in November and December 2022, with 40,156 respondents.

The next 12 months will see a continued shortage of employees in the Czech labor market. Firms active in administration or information and communication are most likely to add employees.

The hospitality, processing, and agriculture sectors are most at risk of layoffs. At the end of 2022 unemployment in Czechia hit 3.7 percent, an increase of 0.2 percentage points compared to the previous year, according to ministry statistics.

One-third of employers want to increase wages for at least some workers. Employees making up to CZK 35,000 would see raises between 5 percent to 10 percent. Those making over CZK 35,000 could get 5 percent more in most cases. But 61 percent of firms don’t plan to raise wages and 4 percent plan wage cuts.

While experts and specialists are still in high demand, low-income workers will feel the effects of the difficult economy. They are not only more likely to be laid off but also less likely to see wage increases.

Of the companies planning to increase wages, less than half plan raises for everyone. Most will offer more in just select job categories. Workers with specialized skills are more likely to get a raise than unskilled workers, senior employees, or administrative employees.

Some employers may also look to increased automation to handle repetitive tasks. This will also have a high impact on unskilled and low-wage occupations. A number of companies are modernizing and replacing these routine tasks, according to the ministry.

Minister of Labor and Social Affairs Marian Jurečka said that the ministry must prepare to support unskilled workers, according to news server Seznam Zprávy. The report says efforts need to be put into increasing job skills and supporting retraining through an active employment policy.

While there are people seeking jobs, they lack the skills that are in the most demand, and this issue needs to be addressed through requalification programs.

Some 42 percent of employers plan to use temporary workers this year, with larger companies using them most often. They are popular in culture, entertainment, and recreation activities, though hospitality, catering, and accommodation come close.

Companies seeking temporary employees are interested in people over 55, as well as parents of children under 10, or students. Small entrepreneurs expect to employ mainly people of pre-retirement age in this way, while medium-sized and large enterprises plan to use short-time work most often for parents of children under 10 years of age.

But overall Minister Jurečka was optimistic. “It is clear from the data that there is no threat of a fundamental crisis that would mean an extreme increase in unemployment. On the contrary, companies continue to look for manpower,” Jurečka said.