Romanian furniture market shrinks, productivity goes up

Furniture companies managed to hold on to their earnings by increasing productivity, although demand on the European markets has been shrinking.

Productivity in the furniture sector increased 25% in the first five months, as compared with the year-ago period, while physical output increased only 17%, Andrei Menhardt, chairman of the Romanian Furniture Producers Association (APMR) told Ziarul Financiar. #leadend# Inflation considered, the furniture production went up only 3% – 4% in the first months, whereas productivity climbed higher, according to data released by the National Statistics Institute.

The lower number of employees in the field may explain this paradox. In fact, the past thirteen years have been defined by a certain trend, which is still visible. “The furniture production went back to the 1989 levels, exports exceeded these levels, while the number of employees has dropped from 160,000 to less than 100,000,” Menhardt said. “And, in the meantime, we’ve lost the Russian market and the former joint economic market of the Eastern European states (which used to absorb 25% of furniture exports before 1989, as compared to less than 10% at this time). If only the same had happened in all the industry branches,” APMR’s chairman added.

The Romanian furniture producers have complained about the European market downturn, although their exports increased 5% – 6% in euros in the first part of the year. The furniture industry basically relies on exports, since 80% of the production is sold abroad and the European Union is the main outlet for the Romanian producers (some 75% of the exports).