Poland records EU’s second largest employment rise during pandemic

Poland has recorded the second largest increase in employment during the pandemic among all European Union countries.

At the end of the second quarter of 2021, there were 2.98 million (0.5%) fewer people in work across the EU than two years earlier, with most member states seeing employment figures shrink, according to figures from Eurostat.

However, over that time Poland’s grew by 150,000 people, or 1.9%. That places it second place both in terms of numbers (behind only the Netherlands, on 222,000) and as a percentage (behind on Hungary, on 3.4%), notes Andrzej Kubisiak, deputy director of the Polish Economic Institute (PIE).

In Poland’s case, Kubisiak explains the growth as a mix of factors related to economic structure, excess labour demand, and the reactions of government, businesses and employees to the crisis.

“The sectors most exposed to closure as a result of restrictions – tourism, restaurants and hotels as well as culture – have a relatively small share in Poland’s GDP and employment structure,” he told Notes from Poland.

In that sense, Poland is in the opposite situation to Italy, which saw the second-largest drop in employment (by 826,000 since 2019).

“Italy was the first country to be hit by the pandemic on a large scale in Europe, and its extensive tourism and service sectors have faced far-reaching negative effects that will not be easily remedied,” says Kubisiak.

Moreover, the Polish economy was already short-staffed even before the pandemic, creating large pools of vacancies, which were the first to dry up during the pandemic.

Finally, Kubisiak argues that Poland offered “large fiscal support” for companies compared to other countries during the pandemic while both businesses and workers were willing to “show determination” and “make concessions” to avoid layoffs.

“Young people and women were most affected by the negative effects,” says Kubisiak. But he notes that among men and other age groups there was an increase in economic activity.

This could be a result of people retraining during the pandemic, but also due to people being forced to enter the workforce as the earnings of other family members deteriorate.

Kubisiak compares this to figures from southern Europe during the financial crisis: “with growing youth unemployment at the time, often older members of households had to shoulder sustaining them.”

Moreover, in many countries hours were cut for many workers, meaning a reduction in salaries, which would not be visible in employment figures.

The employment rate in Poland stood at 75.2% at the end of the second quarter of 2021. This places it in 13th place in Europe, between Portugal (75.6%) and Latvia (75.2%), according to Eurostat figures.

The highest employment rate was recorded in the Netherlands (82%), Sweden (80.8%) and Germany (79.5%), all of which score high on various measures of professional activity among their populations. The lowest numbers came from Romania (66.8%), Italy (62%) and Greece (61.2%).

“The Dutch economy itself could become a certain beneficiary of the outflow of some workers and business from the United Kingdom, which led to the Netherlands increasing the number of people in employment,” says Kubisiak.

Maria Wilczek

Maria Wilczek is deputy editor of Notes from Poland. She is a regular writer for The Times, The Economist and Al Jazeera English, and has also featured in Foreign Policy, Politico Europe, The Spectator and Gazeta Wyborcza.