Romania faces a decline in productivity amid broader European growth

In the second quarter of 2026, Romania experienced a notable decrease in productivity, marking it as the only country in the European Union to report simultaneous declines compared to the same period in 2025. Specifically, productivity per employee fell by 0.8%, while productivity per hour worked saw an even steeper decrease of 1.2%. This downturn places Romania among a select group of EU member states that are grappling with declining productivity metrics.

Comparatively, the average productivity across the European Union rose by 0.9% per person and 0.8% per hour. Only three countries, including Ireland and Italy, alongside Romania, recorded reductions in productivity per capita. In terms of hourly productivity, Romania reported the most significant drop in the EU, underscoring a challenging economic environment.

The decline is further illustrated by the industrial production figures, as Romania recorded the third-largest decrease in the EU, falling 6.3% year-on-year in July 2026. This decline in industrial output highlights the broader struggles Romania faces, including a reduction in the number of employees and slowing wage growth.

While Romania's productivity fell, other countries in the region, such as Slovenia, are witnessing impressive growth. Slovenia's productivity per employee surged by 4.5%, and its productivity per hour worked increased by 5.8% in the same timeframe. This stark contrast emphasizes the challenges that Romania must address to foster economic recovery and growth.

In recent years, Romania has been in a prolonged period of stagnation within its manufacturing sector, facing difficulties for almost two years. The current economic landscape, marked by declining productivity and industrial production, poses significant challenges for the Romanian economy as it navigates a complex recovery path.