Poland

  • © Czarek Sokolowski/AP/PuzzlePix

    About the ILO in Poland

    Anti crisis measures provided a cushion for labour markets

    The transition of Poland in the last three decades is considered a development success story. The country moved from middle to high income status in less than 15 years, entering the group of high-income countries in the mid-2000s. The economy expanded rapidly with growth rates of 4 to 5% per year, job and income growth were broad-based, and prosperity was shared. While in the early 1990s, per capita income was 38% of the EU average, it now reaches 73%. Labour markets benefited from these developments and experienced an impressive turnaround. While unemployment was still at 20% in 2000, the country has currently one of the lowest unemployment rates in Europe at 3%. The employment rate is close to the EU average (71% vs 73%).

    The Covid-19 pandemic caused a relatively mild economic recession in 2020 with a reduction of GDP of less than 3% (EU: -6%). Forecasts predict a quick recovery in 2021. The short-term impact on labour markets was also relatively low with 3.5% of all working hours lost when compared to 2019 (EU: 8%). Employment and unemployment rates including youth unemployment did not change much when compared to pre-pandemic times. The strong government response to the pandemic was decisive to mitigate the labour market impact. The response package was worth 15% of GDP and one of the largest in the region. The main measures included income support for individuals and greater liquidity for businesses. There is some uncertainty around the effectiveness of the package as limited information is available. The government is reluctant to share data on the performance of the anti-crises measures. It designed and implemented these measures without consulting the social partners. Continue reading