Poland’s labor market has transformed from a 20% unemployment rate to a competitive employee market, but recent trends suggest potential mass layoffs in 2024-2025.
From 20% Unemployment to the Fight for Employees: How Poland’s Labor Market Changed
In the last two decades, Poland has experienced extremely different labor market realities. Initially, there was an exceptionally strong “employer’s market” with unemployment averaging around 20%, and in some regions exceeding 30%. Work was cheap, and finding employment required significant effort and often acceptance of very low wages.
Today the situation is diametrically different. Poland belongs to the countries with the lowest unemployment rate in the European Union. Due to demographic factors, the country has permanently entered the zone of an employee’s market, although its intensity varies over time, space, and depending on industry and specialization.
Cooling Employee Market and Wage Pressures
At the level of the entire economy, however, one can speak of a certain “cooling of the employee’s market.” Rising wages – resulting from labor shortages – reduce the international competitiveness of some production and services carried out in Poland. In many sectors, this is still acceptable because wages remain lower than in Western Europe, and often also lower than in the Czech Republic or Slovakia.
However, there are industries with a high share of labor costs, low margins, and strong foreign competition, additionally burdened by high energy costs. There are also areas where there never was and probably never will be an employee’s market – areas with very high labor supply flexibility, where anyone “can come” without qualifications or these can be acquired in a very short time, such as the lowest-paid positions in HoReCa or pizza delivery.
Mass Layoffs in 2024 and 2025: Reasons to Panic?
What about mass layoffs that the press has often written about in recent months? According to the expert, these have been, are, and will be a constant element of the economy. Although this topic has been heavily exploited in the media recently, the real scale of layoffs was much smaller than a decade ago – at about one-third of those values.
Who Will Be Affected by Job Cuts? Industries Under the Most Pressure
In the near future, mass layoffs will primarily affect industries with high labor costs, low margins, and strong international competition, as well as large organizations employing thousands of people, such as shared service centers that will not want to increase wages. There is already evidence of this trend, with news of mass layoffs in companies in this area last year.
While this is not yet a mass phenomenon, there is a clear cooling. Wages may simply stop rising or rise slightly and not for everyone. However, considering how many companies work in this area, some will likely make decisions to relocate. It’s important to remember the proportions and always relate the scale of these layoffs to the total number of people working in a given industry.
Employee Market: Do Qualifications Still Matter?
Social sentiments do not always directly reflect the situation on the Polish labor market. They can be shaped by assessments of one’s own financial situation and the political scene. For employees with real, market-demanded qualifications, the situation remains structurally favorable. With record-low unemployment, losing one job doesn’t mean there are no alternatives – you can always change your place of employment.
However, the situation for employers, especially owners of small businesses, is becoming significantly more difficult. Many small companies will be under increasing market pressure, and some will simply “drop out of the game” due to generally lower efficiency compared to large companies.
Dark Clouds Over the Economy: Public Debt a Bigger Enemy Than the Labor Market
The economist believes that the most serious threat to employment stability is not the labor market itself today, but the state of public finances. Official forecasts predict an increase in public sector debt by 390 billion PLN in 2026.
As a country, Poland is living far beyond its means with few in the political class appearing concerned. While positive effects of strong economic growth “mask” the risks, when growth weakens (which may happen in Poland in 2027 with rising inflation and/or profitability), we could face a “sharp braking” of the economy, including the labor market and numerous other problems.