Robotization trends in SEE

The rapid advancements in robotics and artificial intelligence and the ever wider adoption of those technologies in SMEs bring a multitude of benefits for the economical development of the countries in Southeast Europe (SEE). The combination of falling robot prices, high-wages and shrinking manufacturing labour force available generally boosts robotization across the continent. As a result, the most developed European countries with mature industries and advanced innovation systems are becoming highly robotized, the European Commission reports. At the same time, the pace of industrial robot adoption is much weaker in European countries with low wages, labour-intensive industries and weak innovation performance, such as those in the SEE region. Thus robotization in Europe seems to strengthen the already existing territorial disparities in the EU.

Socio-economic factors

Today Central, Eastern and Southeastern Europe are finding new ways for sectorally more diverse deployment of robots. Statistics show a relatively low share of the service sector compared to the industrial robots sector. The importance of the implementation of robots not only in large industrial enterprises, but also in small and medium business across the region, was strongly highlighted during the challenges posed by the COVID-19 pandemic. The advent of artificial intelligence and robotics has revolutionized various industries, like general manufacturing, automotive production, mechanical engineering, the food and beverage sector, pharmaceutical, etc., offering immense potential for increased productivity, efficiency and innovation. According to the International Data Corporation (IDC) the Central and Southeast European (CSE) spending on robotics and related services grew to more than USD 4,2 billion in 2020.

Focusing on European manufacturing industries, experts find that robot adoption positively affects total employment, in spite of the popular fear that robots will replace humans and threaten their jobs. Today industrial robots are mainly deployed in sectors with middle or higher skills requirements and their penetration is very limited in those manufacturing sectors (such as textile, food, beverage) where the majority of low-skilled are employed and the tasks carried out are easily replaceable by robots also at the current level of technology, analysts conclude. The dominant narrative about robotization is slowly changing, but experts estimate that people expect replacement of humans’ by robots for 14 – 50% of jobs and transformation of 25 – 60% of jobs.

The labour-friendly impact of robotization, on the other hand, is detected mainly in core and service-oriented countries and for those at the top of the occupational structure (managers and technicians). In turn, peripheral European countries and manual workers do not seem to benefit much from robotization, studies show.

While in the most developed European countries the combination of falling robot prices and high wages boost robotization, these driving factors do not sufficiently explain why there is a sharp increase in deployment of industrial robots in European countries with low wages. Particularly, in Central and Eastern Europe where a decade ago industrial robots were almost non-existent but today more than 30 000 robots are at work, researchers point out.

The aging of the population in Europe, including the SEE region, has serious economic and social consequences and calls for serious action, such as massive automation. Although increasing labour productivity through robotization might mitigate the effects of a decline in the working age population. In 2020, while migration and aging shrunk the labour force, productivity has surged, particularly in Serbia, Montenegro and North Macedonia. The real technological revolution where the region has a significant chance globally is the use of robots – both industrial and service, experts conclude.

Geographical aspects

The International Federation of Robotics reports that the European Union has a robot density of 208 units per 10 000 employees. A study by the EC shows that in the last three decades (from 1995 till today) the robot density in Europe extensively increased, changing both the manufacturing and the labour landscape. If in 1995 there were 0,626 robots per thousand workers, in 2005 they were already 1,032 and in 2015 – 1,468. The robotization across Europe in the period is described as a diffusion wave, consisting of two main time segments. If in the period 1995 – 2015 smaller countries and weaker regions were mostly catching up with large economies, such as Germany, from 2006 to 2015 a new group of countries (in Central, Eastern and Souteastern Erope) entered the local robotization map.

Studying the concentration of automation in large economies, researchers find that 44% of robots in the CEE and the SEE region are deployed in the automotive sector, as one out of five European motor vehicles is produced there. The general industry segment, such as companies producing metal parts, that use robots for arc welding, spot welding, etc. have reached complete readiness for automation, experts underline.

Meanwhile, there are traditionally highly automated sectors, such as the food production and packaging industry. However, these sectors are automated through the so-called rigid automation methods. Other sectors that are getting increasingly automated, are manufacturing, metal casting, inject molding, assembling, intralogistics, and so on.
Analysts have found out that companies in the CSE region are increasingly investing into industrial robots to stay competitive, which has become a priority for many countries there. Although the share of companies, using robots, stays relatively low, compared to the more developed regions of Europe and the world.

According to a report on the share of enterprises deploying industrial and service robots in Central and Eastern Europe (CEE) by country and type, published by Statista Research Department, it lays between one and six per cent. In Slovenia, which leads the chart, eight percent of enterprises use industrial robots while only one percent of companies employed service robots as part of their business. For Croatia the share is 5% for industrial and 3% for service robots, respectively. In Bulgaria it’s 4% and 2%, in Bosnia and Herzegovina – 3% and 1%. The same is the situation in Romania, while in North Macedonia the share of companies using industrial robots is only 2%, three times lower than that of service robots (6%). In Montenegro only one per cent of the businesses deploy industrial robots and no service robots are officially announced to be used, Statista further informs.