LTRK: Labour Costs to Be Latvian Businesses' Top Concern in 2027
A survey by the European chambers of commerce association Eurochambres shows Latvian business expectations for next year are less optimistic than before but still high. Labour costs and the regulatory burden are the main challenges in Latvia.
The Latvian Chamber of Commerce and Industry (LTRK) has presented results of an economic survey by Eurochambres, the association of European chambers of commerce and industry, looking ahead to 2027. The survey gathered responses from 40,717 businesses in 27 European countries. In Latvia, business expectations are less optimistic than a year earlier, though confidence remains high.
Latvia compared with other countries
Sales prospects on the domestic market are assessed more positively, placing Latvia third among the surveyed countries. Latvia ranks sixth for export sales forecasts. Its employment forecasts are positive and also rank third, while across Europe they are negative. On investment expectations Latvia is fifth.
LTRK notes that the latest LTRK index reflects similar mild optimism. In the second quarter of this year, the future index pointed to positive expectations for the next six months, while the assessment of the current situation was slightly pessimistic, especially regarding overall economic activity in the country.
Main challenges
Latvian entrepreneurs expect labour costs, which rank first for the fourth year in a row, and the regulatory burden to be the main challenges next year. More than half of respondents cite a shortage of qualified staff, and about half name energy costs; Latvia is fourth on that measure. Trade barriers and financing conditions cause the least concern.
Katrīna Zariņa, chair of the LTRK board, believes the new Saeima (Latvia's parliament) and government should use these forecasts as a roadmap for changing the direction of economic development. In her view, solutions to high labour costs must come first. She also urges special attention to promoting exports.
The European picture
At the European level the survey shows a mixed picture. Sales forecasts on both domestic and export markets have become more positive for the first time in several years, driven by recovering demand and a gradual normalisation of trade conditions. Overall sentiment nevertheless remains cautious: employment forecasts are negative for the fourth year running, investment expectations lag behind the historical average, and business confidence may slip below its ten-year average. Across Europe, the top challenge is energy costs and access to raw materials at acceptable prices, followed by regulation, labour costs and a shortage of qualified staff.
