Improving personal finances and taking care of health were the main objectives for this year for most of the 504 participants in a survey that “Monitor” conducted regarding the expectations of citizens and businesses. About 67% of them claimed that the financial situation in 2024 had not changed, or was worse than in 2023. Respondents chose more than one challenge they had already overcome for 2024. For the majority, 74%, “increased cost of living” was the main concern. 17.8% of businesses claimed that they will go bankrupt and reduce activity in 2025, while 29% claimed that they will expand
Above-average economic growth and, on the other hand, population reduction are not helping Albanians escape the trap of a weak economy. High living costs and improving personal finances remain the fundamental challenges for a large part of educated and stable Albanians. A “Monitor” survey, which was conducted in December, where 504 people were surveyed, found that for 67% of them, their financial situation last year had not changed or was worse than in 2023. Only 32% claimed to be in a better financial situation. The survey was conducted online, through the ECR (Engaged Citizens Reporting) platform. The sample is random and does not constitute scientific findings.
Over 17% said that the financial situation in their families was very bad and for the majority, almost 74%, the increased cost of living was the main challenge of the past year. Of the survey participants who owned businesses (45 in total), 20% said that the performance of 2024 was very poor, compared to 6.7% who said it was very successful. The majority of businesses, 42%, are mostly aiming for stability this year and 29% of them are aiming for further expansion. The economic situation and health are the most influential issues this year among the respondents.
COST OF LIVING, THE MAIN CONCERN IN 2024
The high cost of living was the main concern of citizens in at least four surveys that “Monitor” conducted through open calls that mainly focused on economic developments. The fact that the poor economic situation is stressful for middle-class families and those with professions that provide above-average incomes remains worrying. A group of people, almost all with higher education and scientific degrees, respond to “Monitor” surveys. In the latest survey that addressed citizens’ engagement for the end-of-year holidays, there were questions about the challenges that individuals and families have overcome and that they expect to overcome. Respondents chose more than one challenge that they had overcome for 2024. For the majority, 74%, “the increased cost of living” was the main concern along with the other challenge, which almost 54% of participants claimed they were unable to save.
For 63%, the increase in the prices of basic products, such as food, fuel, etc., was a challenge, and family debts were a challenge for 11% of participants. Recent “Monitor” surveys have revealed that Albanian families are increasingly unable to afford the costs of raising children. High fees for preschool and after-school educational services are making raising children increasingly difficult financially.
The inclusion of women in the labor market has increased the need for paid care in the family. The shortage of labor and the high need for childcare have increased the prices of services, making it difficult for families raising children to make ends meet. More than 20% of respondents stated that last year, their biggest challenge was meeting family expenses such as education and extracurricular activities such as courses, etc. Issues related to the economy were a major concern for everyone. Given that respondents could resolve more than one challenge they faced in 2024, 23.6% of them stated that income insecurity was a challenge, while for 18% it was paying the monthly rent and loan installments. “The cost of living has become very expensive. The increase in rent and loan installments has had a negative impact. On the other hand, the decline in foreign currencies EUR and USD has eroded savings,” says a business representative from Durrës.
Over the last three years, the country’s economy has grown above the average of the past decade and, on the other hand, the country’s population has decreased by over 420 thousand inhabitants between 2011-2023, according to Census data.
But economic growth remains stagnant, as its distribution is not being done fairly across the population. Other official country indicators refer to this fact. More than 1 million Albanians suffer from a severe form of poverty, according to the latest INSTAT data that measured income and living standards in 2023. According to the latest results, Albania had 42.1% of residents suffering from a severe form of poverty. Over 1 million Albanians live in families that cannot afford at least 7 out of 13 categories of material deprivation (6 categories related to deprivation at the individual level and 7 categories related to deprivation at the household level). According to European parameters (Eurostat) an individual is considered poor if he/she does not have the opportunity to have an internet connection, to replace old clothes with some new ones, to have two pairs of shoes that fit properly (including one pair of shoes for all seasons); to spend a small amount of money each week on oneself, opportunities to have regular leisure activities, and meeting friends/family for a drink/meal at least once a month.
According to INSTAT, more than 42% of Albanians do not have this opportunity, confirmed by all “Monitor” surveys.
CHALLENGES BECOME VARIOUS
Rapid urbanization, demographic changes, the burden of diseases and some specific economic developments have increased the burden of challenges for citizens. For example, some respondents stated that the biggest challenge last year was the inability to buy a house, for some it was the decline in the exchange rate. The depreciation of the Euro against the Lek has eroded the income and profits of businesses and individuals who have income in the EU’s common currency. High health care costs are a challenge for a small portion of individuals, while corruption was the biggest concern last year for a small portion of respondents. Issues such as family conflicts over property development were concerns. High fines, fees and service taxes from e-Albania were a challenge for two respondents. “The government should increase pensions, because we can’t afford it,” says a pensioner from Korça. There are also those who are tired of city life. Bardhi from Tirana says he aims to build a “remote” life, to break away from the jungle of Tirana, and his motto is: “Work, live, produce everything yourself.”
17.8% OF BUSINESSES PLAN REDUCTION AND BANKRUPTCY
Business stability, i.e. maintaining activity performance at the 2024 level, is the main expectation of businesses for 2025. 42% of them chose maintaining current stability as their main expectation for this year. Unexpected risks occurring in external and internal markets such as wars, climate impacts and unexpected events have increased uncertainty for businesses. Therefore, maintaining activity stability is considered a key achievement for this year.
A large percentage of businesses, 17.8%, said they will go bankrupt and reduce activity in 2025. 6.7% of businesses that participated in the survey said they will close their business this year, while 11% of them will reduce activity. Another 11% do not feel confident about this year’s developments and about 29% said they will expand further.
2025, OPTIMISM PREVAILS
Optimism prevails over pessimism in 2025. About 42% of respondents said they feel optimistic and very optimistic and only 18% pessimistic and very pessimistic. A significant portion of respondents, about 40%, have a neutral attitude towards levels of optimism this year. To the question “Are you optimistic about the coming year? (business and individual), 39.9% answered neither pessimistic nor optimistic, 34.5% said optimistic, 11.9% slightly pessimistic. 7.7% said they feel very optimistic and 6% of respondents said they feel very pessimistic. (Monitor.al)
