Declining markets index

Introducing the Declining Markets Index – a radar of struggling sectors in the Polish economy

„The Polish economy is still emerging, but some of its sectors are… „submerging”. We analysed 71 PKD industry codes based on hard data from the National Court Register (KRS): return on equity and return on assets, sales volume, equity levels and total assets”.

– says Marcin Senderski, Partner at Cognivate.

Indeed: using company financial data from the KRS (obtained through solutions provided by MGBI) for 2021 and 2024 (the most recent complete data series), we examined which sectors of the Polish economy are in the most difficult position. In total, the Declining Markets Index covers 71 sectors.


 

We treated five phenomena as signals of a sector’s poor condition:

  1. Low return on equity

  2. Falling return on assets

  3. A shrinking market

  4. Capital outflow

  5. Dwindling assets

In each of these dimensions, the five worst-performing sectors received 3 points each, the next five received 2 points, and the following five received 1 point. In this way, each of the 71 sectors of the Polish economy was ranked on a scale of 0–15, with a higher score indicating more serious trouble.

Results

Here are the sectors in the most difficult position:

We classified sectors scoring more than 5 points on the Declining Markets Index (i.e. more than one-third of the maximum possible score) as troubled sectors. We then examined their weight in the Polish economy by measuring the share of companies from these sectors in total revenue across all sectors and in the total number of companies. It turned out that they account for 8.6% of total revenue and 6.7% of all companies in the Polish economy.

For more details, including an analysis of the Declining Markets Index among large sectors (over PLN 50 billion in revenue in 2024), see the full Declining Markets Index report prepared by Cognivate – link at the top of the page.

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