Slovakia’s economy faces a challenging outlook, with a new forecast predicting the potential loss of 23,000 jobs by 2030. The projections, released Tuesday, February 10, 2026, by the Council for Budget Responsibility (RRZ), reflect a confluence of factors including government austerity measures, energy subsidies, and headwinds in the automotive sector.
The RRZ’s updated macroeconomic forecast anticipates economic growth falling below one percent. This slowdown is attributed to the combined impact of government consolidation packages, the implementation of an energy subsidy scheme, and difficulties within the crucial automotive industry.
Economic Headwinds Mount for Slovakia
The RRZ identifies the latest round of government consolidation measures as a primary driver of the revised forecast. “It significantly weakens economic growth and, due to its anti-growth structure, will contribute to lower economic potential, a further decline in competitiveness, and reduced attractiveness for investors,” analysts stated.
The recently approved energy subsidy scheme is also cited as a contributing factor. While intended to provide relief to households, the RRZ argues that the scale and design of the scheme are pushing inflation higher – reaching 3.6 percent this year. The energy sector is a key component of the Slovakian economy, and government intervention in pricing can have broad macroeconomic effects.
Job Losses Anticipated Amidst Economic Slowdown
The impact of these economic pressures is expected to be felt by workers. While nominal wages are projected to increase by 4.4 percent, the RRZ cautions that this increase will be largely illusory.
“After accounting for higher taxes and social contributions, households will face stagnation in real disposable income this year,” the RRZ report indicates. In other words that despite higher numbers on their paychecks, individuals will not be able to purchase more goods and services than they did last year.
The forecast also highlights a concerning outlook for the labor market. The RRZ notes that the labor market is beginning to cool as economic growth slows and uncertainty increases, predicting an overall decline of approximately 23,000 jobs by 2030.
“The decline in employment in the early years of the forecast will be mitigated by the base effect of the impact of a high number of early retirements, and will later be reduced mainly by the declining number of people of productive age,” analysts explained.
Adding to domestic challenges, the Slovak automotive industry is losing ground in key markets in the United States and China, further undermining the country’s economic performance. The automotive sector is a significant employer and exporter for Slovakia, making its struggles particularly impactful.
The full macroeconomic forecast from the Council for Budget Responsibility can be found on this link.
