Romania’s tech sector faces headwinds as global IT slows: ANIS
BUCHAREST, ROMANIA — Romania’s IT industry, a cornerstone of the local economy, grappled with significant challenges in 2024, including fewer new contracts, layoffs, and fiscal instability.
According to the Employers’ Association of the Software and Services Industry (ANIS), the sector stagnated in the last two quarters but remained a key net exporter.
“2024 was a year with many challenges, and these began in 2023,” Corina Vasile, ANIS executive director, told Economedia.
She attributed the struggles to fiscal instability, global economic shifts, and the rise of artificial intelligence. A major blow came in late 2023 when tax facilities for IT workers were reduced, increasing labor costs by 5-10%, compounded by inflation. As a result, expected salary increases for 2024 were effectively canceled.
Global trends and local impacts on workforce
The global economic downturn also took its toll. International companies implemented layoffs that impacted Romanian teams, though many of these were offset by hiring for newly created roles. However, overall team growth slowed compared to previous years.
“Most companies are cautious and teams have not grown at the pace of previous years. All of this has contributed to decreasing the pressure on hiring, which has translated into greater labor availability in the market,” noted Vasile.
On the business side, securing new contracts became more challenging as other sectors delayed investments. Despite these hurdles, Romanian IT exports showed resilience, with slight growth reported in October compared to the same period in 2023.
2025 outlook: Digitalization offers hope amid concerns
Looking ahead to 2025, ANIS is conducting its annual Sentiment Survey to assess industry expectations. Preliminary findings highlight concerns over potential tax hikes and legislative instability.
However, there is optimism about increased domestic demand for IT products and services. Accelerating the digitalization of public services could significantly boost the local market.
“Romania has favorable premises to become a technology, Research and Development and innovation hub,” emphasized Vasile. She stressed the importance of preserving competitive advantages and maximizing the IT sector’s impact on the national economy.
New fiscal policies add to industry strain
A government ordinance passed at the end of 2024 further strained the industry by eliminating tax incentives for IT workers. ANIS criticized these abrupt changes, warning they would reduce global competitiveness by driving up labor costs and potentially leading to additional job losses after a decline of approximately 10,000 jobs in 2023.
Despite these challenges, ANIS remains cautiously optimistic about growth resuming in 2025 if supportive policies are enacted and digital transformation efforts are prioritized. The association also called for strategic measures to position Romania as a regional leader in technology and innovation.
