Preliminary estimates of the Central Statistical Office show that Poland recorded a decrease in GDP in the second quarter compared to the first quarter by 2.3%, and our economy grew year on year by 5.3%. At the moment, we are the European Union leader in terms of GDP decline in the last quarter.
Bogusław Grabowski, economist and former member of the Monetary Policy Council in 1998-2004 (on the recommendation of AWS), in an interview with money.pl, notes that “Reading this record is tragic.” He points out that “The Polish economy has affected the shoals from which it will be withdrawn for a very long time“.
If the economic turmoil worsens, companies will slow down
Experts have no doubt that we are slowly entering a period of stagflation, which will also have a negative impact on the labor market. The fact that it is not going in the right direction is also indicated, among other things, the study of the deteriorating economic situation especially in the industry.
We wrote about it a month ago. At that time, experts also pointed out that Wage growth has not kept pace with inflation. As a result, they predicted that if the economic turmoil deepens in the coming months, businesses will begin to slow down.
This scenario appears to be coming true. The symptoms of an economic slowdown are already evident in the labor market. This was confirmed by experts from the Polish Economic Institute in the latest report of the Economic Weekly Bureau. It shows that for the first time for several months, in August, more entrepreneurs planned to lay off workers in the coming months (12%) than to hire employees (10%).
So there has been a reversal of trend since the beginning of the year, when hiring outnumbered layoffs. PIE also informs that since the beginning of the year the share of companies announcing layoffs has also increased, and at the same time the percentage of entrepreneurs who want to hire is decreasing.
The industry sector is in the worst condition
Small and micro businesses from the production, TSL (transportation, freight, logistics) and service sectors are currently planning most layoffs. On the other hand, medium and large companies as well as construction companies are still more willing to hire than lay off.
The manufacturing sector is in worse shape. Companies in this sector plan to lay off workers more often than increase hiring. The PIE report also shows that more than half of the companies that plan to lay off workers are also seeing a decrease in sales (55%) and the number of new orders (52%).
However, the economic slowdown is the most severe Impact on lower demand in the industry. This also translates to the position of companies in this sector, which are losing cash. Another bad news is the fact that industrial companies do not have the funds to carry out new investments.
However, we are not threatened by increased unemployment
Do these data portend a more serious “collapse” in the labor market? According to experts, there is nothing to worry about at the moment, as the current situation does not affect the unemployment rate. Let’s remember that in July Poland’s registered unemployment rate was just 4.9 percent, the same as the previous month’s rate. It is also the lowest score in more than three decades. At the same time, Eurostat data shows that unemployment in Poland in June It was one of the lowest in Europe It was 2.7 percent.
However, there is something else worrying. According to data from Grant Thornton, July was the third consecutive month that the number of new job offers declined. Compared to the previous month, it was a decrease of 0.1 percent, but as much as 6.3 percent compared to last July. The decrease compared to June 2022 was small, but larger than last year, which was caused by the record number of job offers in 2021.
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See also: Where are the biggest price increases? Practically everything is more expensive.
Industry was a “stabilizing factor” for the economic situation in Poland
Andrzej Kubisiak, Deputy Director of the Polish Economic Institute, believes that the current situation in the labor market is the result of the fact that companies are already beginning to feel prices for energy raw materials, which translates into higher corporate costs. However, the industry sector, one of the most energy-intensive industries, is the hardest hit.
– It is important because the industry has so far been a “stabilizing factor” for the economic situation in Poland, especially during the pandemic crisis. It should also be noted that the industry sector is also the largest employer in Poland. He adds that a fifth of total employment in Poland is in the industrial sector.
In his opinion, in the near future, the key will also be What will be the state of the German economy?. He adds that the effects of the energy crisis are not only affecting the Polish industry.
As you know, during the pandemic around the world, consumers spent more money on the purchase of so-called fixed assets – they bought more furniture, interior furnishings and electronics than usual, while the structure of spending decreased, for example, in tourism and services. This translated into a global revival of the industry.
In contrast, with the lifting of the lockdown, the condition of the industrial sector began to deteriorate. reason? The demand was so great that the industry was not able to handle the increasing number of orders.
– The result was the show shock that we noticed last year. Today, however, the situation is different. The industry sector is struggling with increasing energy costs. Our research shows that this is a major drawback for the industry today – says Andrzej Kubisiak.
The labor market is overheated, and a “cold shower” awaits
The PIE report also shows that companies are now planning hiring more carefully. According to our interviewer, this is not necessarily bad news. – The job market has been very hot so far, The economic situation is now deteriorating. At the same time, we still have a low unemployment rate and a record number of vacancies in the economy. Rising demand with fewer available employees has warmed the labor market, which we saw in the first half of the year – commented a PIE expert.
In his opinion, in practice, companies will create new jobs to a lesser degree, and some will reduce the level of employment, which does not mean that they will not create new jobs in the future.
Employees who have lost their jobs still have a good chance of finding a new one
Matthews Schedik, a spokesman for Randstad, also confirmed that the percentage of companies planning to hire new employees had fallen in the second half of the year. He also reported that there is a growing group of employers who are not planning any actions in the field of employment. According to Randstad, the proportion is already 69 percent. Comp.
– So it can be expected that by the end of the year the number of employers who will leave work at the current level – comments Mateusz Żydek.
However, in the opinion of our interlocutor, this data is not alarming, so it will not have an impact on the increase in the unemployment rate. – There are many indications that employers announcing their layoffs are referring to individual jobs rather than mass layoffs. In addition, there are still many companies and sectors that have not been successful in hiring, a Randstad spokesperson said.
He adds that employees who lose their current jobs will still have a chance to find a new one. More than 88 percent of Randstad respondents believe that within six months they can find a new job.
However, the mismatch between employer requirements and employees’ competencies may present a challenge. In addition, the offers available may be less attractive than they were a few months ago. For people who have lost their jobs, this could mean deteriorating working conditions, Reward level and benefits offered.
Matthews Sidk also draws attention to the fact that difficulties in finding a job may arise in areas where a large employer dominates. – Employees who lost their jobs in such companies may have a limited number of job offers in the local market – says our interviewer.
Some companies will stop production
At the same time, experts agree that the increase in the price of energy goods is the most harmful to the industry. – Already, every second industrial employer surveyed expects a recession in Poland. As a result, some companies may give up part of their production, and this could have the effect of reducing employment, says a Randstad spokesperson.
In his opinion, the second factor that has a negative impact on the state of the industrial sector is the problems of supply chains, including for the supply of raw materials and components, among others, from Asia. – This may have an impact on downtime, and consequently lower demand for employees – adds our interviewer.
Mateusz Schedik also believes that the situation of Polish employers will also be affected by the so-called internal consumption.
Faced with the rising cost of living, some consumers may choose not to purchase less needed items. This applies to electronics, cars, furniture and building materials. These changes in consumption will not only affect the manufacturing industry, but alsoAlso for some retail business, including e-commerce, And indirectly in the logistics industry – sums it up.
What matters to entrepreneurs is the lack of stability
On the other hand, Robert Lisicki expert union Leviathan is optimistic. In his opinion, our labor market remains stable and resistant to economic turmoil, both at home and abroad. Therefore, you will react to the economic slowdown with a delay.
The expert also draws attention to the fact that our labor market is not standardized, and therefore much depends on the sector of economic activity that is included in the study.
– In practice, many production plants still tell us about the difficulties in filling vacancies, not to mention the IT sector or road transport. Therefore, the data on the increase in the number of people who lost their jobs rather reflects the caution of employers caused by the unstable economic situation. For companies, stability and predictability are important, and there is no such thing, he comments.
At the same time, it is data-driven union Leviathan appears up to 72 percent. Entrepreneurs believe that in the past six months their business conditions have deteriorated.
Many companies are still feeling the effects of changes in supply chains and the loss of markets and contractors as a result of the war in Ukraine. We do not know how the costs of economic activity will rise, especially due to higher energy costs and higher prices for goods and services. He concludes that the key question is to what extent companies view this situation as temporary remains open.
Agnieszka Zielińska, money.pl . journalist
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