Industry is a large but declining sector of the economy of Slovakia. According to 1998 data, industrial production made up 33 percent of the country's GDP and employed 37 percent of the labor force, or 1,238,360 people, in 1994. Slovakia is experiencing a long-term decline of industrial production as fewer unnecessary products are being produced under capitalism as were produced under communism. There has also been a reduction of heavy and light industry and a move toward services. In the first decade of the free-market economy, employment in the industrial sector shrank, with the most significant job losses in the areas of construction, machinery and equipment, metals and fabricated metal products, and mining and quarrying. The only increase came in the area of textile production. In spite of this decline, industry continues to produce a significant portion of exports from Slovakia to other countries.
While the majority of large and medium-sized enterprises have been privatized, some companies remained in government hands until as late as 1999 and 2000. Some of these companies had significant debts, making their privatization politically unpopular because of potential job losses. Other companies were initially categorized as strategic enterprises and were left out of the first efforts of privatization. In 1998, Slovak Telecom and SPP, the Slovak gas company, were privatized.