Current Economic Trends


Current Economic Trends

Current economic trends from 15 to 19 February 2021: electricity consumption, electricity consumption by consumption group, traffic of electronically tolled vehicles, labour market and other charts

Electricity consumption in the first half of February was similar year on year, while freight traffic on Slovenian motorways was still slightly lower than before the epidemic. The epidemic has a strong impact on the labour market – in 2020 employment fell by 0.8%. Unemployment has otherwise declined seasonally since the end of January, as expected, but it was around 15% higher year on year in the middle of February. Construction activity also strengthened in the last quarter and was, like industrial production, higher year on year. In 2020, the current account surplus was the highest thus far, at EUR 3.4 billion (7.3% of estimated GDP).

Amid a partial relaxation of containment measures, electricity consumption in Slovenia in the second week of February was equal to that in the same period last year. Among Slovenia’s main trading partners, the largest year-on-year decline in consumption was, as in the entire period of the second wave of the epidemic, recorded in Austria (6%), but it was somewhat smaller than in the previous weeks of the second wave of the epidemic due to the relaxation of some containment measures (particularly the opening of shops and service activities). Consumption in Germany was also down year on year (5%). In Italy, France and Croatia it was roughly the same as last year.

 

In January, industrial and small business electricity consumption fell somewhat more than in previous months of the second wave of the epidemic. Industrial electricity consumption was 6.5% lower year on year in January (3.6% lower in the last quarter of last year). After decreasing in December due to the easing of measures around the public holidays, in January the year-on-year decline in electricity consumption by small business consumers, which also include trade and service activities, increased again (to 14.6%) and was somewhat higher than in November at the beginning of the second wave of the epidemic (13.4%). Household electricity consumption was up 9.3% year on year, as people spent more time at home due to remote work and schooling.

Freight traffic on Slovenian motorways in the second week of February was 5% lower year on year. In the week between 8 and 14 February, for which two days are excluded from the comparison due to the public holiday, domestic traffic was 2% and foreign traffic 7% lower year on year. In contrast to the majority of industrial activities, which have already achieved or exceeded pre-epidemic levels, freight traffic still lags slightly behind, which can be attributed to the weakening of some global goods chains (for example through ports) and, to some extent, the containment measures in services. These have been partly lifted with the improvement of the epidemiological picture in the last few weeks.

 

Following a seasonal increase in December and January, the number of registered unemployed persons has seasonally declined. With intervention measures still in place, the increase in December and January did not deviate significantly from seasonal increases in the same periods of previous years. At the end of January, it came to a halt and in February, a seasonal fall in unemployment has already been observed. According to ESS unofficial (daily) data, 89,008 persons were unemployed on 18 February, which is 2.7% less than at the end of January and around 15% more than in the same period last year.
The number of employed persons was 1.4% lower year on year at the end of last year. In the year as a whole, it declined by an average of 0.8%. It fell the most in accommodation and food service activities and administrative and support service activities, which were the most affected by containment measures, while it increased in health and social work.

 

 

In 2020, the year-on-year growth of the average gross wage was significantly affected by the payment of crisis allowances and the inclusion of employed persons in intervention job retention schemes. With the declaration of the second wave of the epidemic, wage growth in the public sector, particularly social work and health, increased again in the last quarter of the year due to the renewed payment of allowances (the extraordinary payment of allowances for hazardous working conditions and additional workloads and the payment of the bonus for work in crisis conditions in accordance with the collective agreement). Wage growth in the private sector was lower than in the previous two, although it strengthened somewhat in December, mainly due to the crisis bonus. In the year as a whole, it rose by 4.4%; in the public sector, where the high growth was, in addition to allowances, also due to the wage agreement with trade unions from 2018, it increased by 7.8%.

 

Construction activity strengthened in the last quarter of 2020. The value of construction output increased by 4.1% in the last quarter and was 6.3% higher than a year before. In the second half of last year, construction activity was lower compared with 2018 and 2019 in non-residential buildings, slightly higher in civil-engineering works and considerably higher in residential buildings (where data for the last months are less reliable).
Short-term prospects remain favourable for civil-engineering works and residential buildings; for non-residential construction, on the other hand, they look worse. In 2020, the stock of contracts in the construction of civil-engineering works increased by 23%, while in the construction of non-residential buildings it declined by 34%. The number of issued permits for the construction of new flats, which had declined in the first half of 2020, rose in the second.

 

 

In 2020, the current account surplus was the highest thus far, at EUR 3.4 billion (7.3% of estimated GDP). In the current account, the impact of the epidemic was reflected particularly in the segment of goods and services trade. The higher surplus in current transactions derived mainly from a higher trade surplus in goods, as the fall in real imports was deeper than in exports due to lower spending and investment. The terms of trade also improved, as import prices dropped more than export prices owing to a fall in energy and industrial producer prices. The surplus in services trade declined, largely due to a fall in the surplus in travel and air transport services. Net outflows of primary income were down due to a lower net outflow of income on equity (dividends and distributed profits), which is related to a fall in economic activity at home and abroad. The current account surplus also strengthened as a result of net outflows of secondary income, which fell mainly as a consequence of lower payments of contributions and taxes abroad and higher receipts from the EU budget. From the point of view of the savings/investment gap, the surplus in current transactions reflects extensive saving of the private sector (households and non-financial corporations).

 

Back