The specificity of the modern labour market in Poland

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University of Life Sciences in Lublin

The specificity of the modern labour market in Poland

Maria Miczynska-Kowalska, prof. dr. hab.

Е-mail: Maria.Miczynska@up.lublin.pl

Poland

Annotations

The aim of this article is to present the situation of the labour market in Poland as an example. The article presents the specifics of the labour market in Poland facing the economic crisis, (called the Great Recession, which took place in 2008) and in later years, up to 2015. The study used an analytical and synthetic method as well as a secondary analysis. It contains an analysis and a synthesis regarding the labour market in Poland in the period under review and shows the country's efforts to reduce the level of unemployment as well as the improvement of the Polish labour market's situation by 2015, as indicated by the employment rate in Poland (which is currently only 2.6 percentage points lower than in the EU). The article stresses that the state policy pursued during the economic crisis, as well as in later years, helped to reduce the level of unemployment. It points out that (during the crisis and in later years) the categories of workers that were the most vulnerable to unemployment were young people, especially first job seekers, the elderly aged 60 or more, women, as well as people without profession with a low level of education. In contract, factors that reduced the risk of long unemployment included: higher education, investing in knowledge, active job search, mobility, openness to new forms of employment, including the use of temporary work services, as well as flexible forms of employment.

Keywords: labour market, economic crisis, unemployment, employment, forms of counteracting unemployment.

Специфіка сучасного ринку праці в Польщі

Марія Мичинська-Ковальська

Метою статті є висвітлення стану ринку праці в Польщі. У статті представлена специфіка ринку праці в Польщі в умовах економічної кризи, (період великого спаду, який відбувся в 2008 році) і в наступні роки до 2015 року.

Стаття містить аналіз і синтез ринку праці в Польщі за досліджуваний період і обгрунтовує шляхи зниження рівня безробіття та поліпшення ситуації польського ринку праці до 2015 року. За даними проведеного аналізу рівень зайнятості в Польщі на 2,6% нижче, ніж в країнах ЄС. Стаття підкреслює, що здійснювана державна політика під час економічної кризи, а також у наступні роки, допомогла зменшити рівень безробіття. Це вказує на те, що, під час кризи і в наступні роки, категоріями працівників, що найбільш уразливі для безробіття були молоді люди, люди у віці 60 або більше років, жінки, а також люди без професії або з низьким рівнем освіти. До факторів, які знижують ризик безробіття, відносяться: вища освіта, інвестування в знання, пошук активної роботи, мобільність, відкритість до нових форм зайнятості, включаючи використання послуг тимчасової роботи, а також гнучкої форми зайнятості.

Ключові слова: ринок праці, економічна криза, безробіття, зайнятість, форми протидії безробіттю.

Специфика труда на современном рынке в Польше

Мария Мичинская-Ковальская

Целью статьи является освещение состояния рынка труда в Польше. В статье представлена специфика рынка труда в Польше в условиях экономического кризиса, (период большого спада, который состоялся в 2008 году) и в последующие годы до 2015 года.

Статья содержит анализ и синтез рынка труда в Польше за исследуемый период и обосновывает пути снижения уровня безработицы и улучшение ситуации польского рынка труда до 2015 года. По данным проведенного анализа уровень занятости в Польше на 2,6% ниже, чем в странах ЕС. Статья подчеркивает, что направленная государственная политика во время экономического кризиса, а также в последующие годы, помогла снизить уровень безработицы. Это указывает на то, что, во время кризиса и в последующие годы, категориями работников, наиболее уязвимыми для безработицы были молодые люди, люди в возрасте 60 или более лет, женщины, а также люди без профессии или с низким уровнем образования. К факторам, которые снижают риск безработицы, относятся: высшее образование, инвестирование в знания, поиск активной работы, мобильность, открытость к новым формам занятости, включая использование услуг временной работы, а также гибкие формы занятости.

Ключевые слова: рынок труда, экономический кризис, безработица, занятость, формы противодействия безработице.

1. Active forms of counteracting unemployment - the contemporary labour market in Poland

In today's world, one of the most pressing problems that still has not been fully resolved is the problem of unemployment. Initially, unemployment intensified in the 1930s, when in many countries it exceeded 25%. The scale of unemployment increased also in the 1980s and 1990s in countries undergoing transformation, including Poland. Another crisis, this time worldwide, took place in 2008, and it has been referred to as the Great Recession. This crisis had various impacts on labour markets and unemployment rates of the EU countries. In economics, unemployment is regarded as an analytical category of the labour market. It is referred to as an «unrealised supply of labour, which is the result of an imbalance between labour supply and labour demand» [1, p.8].

Currently, the Polish legislation defines the unemployed as follows: «people unemployed and not performing other paid work, capable and ready to take up employment in full-time mode in given professions, services or other paid jobs; or disabled people, capable and ready to take employment in at least half of the standard working time; people not attending school, with the exception of those attending schools for adults or taking external examinations covering the curriculum of these schools or universities where they study part-time; people registered in the correct district labour office according to their place of permanent or temporary residence, seeking employment or other economic activities» [2].

In case of crisis and problems on the labour market, most commonly used instruments and actions undertaken within the framework of the labour market policy are: job creation by governments to subsidise the creation of new jobs, reduction of working time, part-time work, partial financing of enterprises, training, reduction of non-wage labour costs, establishment of employment agencies. The concept of transitional labour markets is connected to the current socio-economic research on the problem of unemployment. This concept, as a coherent approach to the labour market policy, appeared in Germany in the 1990s. It was created by Gunther Schmid. According to him, transitional labour markets are teams of institutional norms and instruments that create conditions for the functioning of workers on the labour market in situations significantly deviating from typical states of employment [3, pp. 30-31]. Transitional labour market is a combination of paid work and other types. Transitional employment is an option everyone can benefit from. The transitionality of labour markets manifests itself in the dimension of time and organisation. Nowadays, according to Schmid, the concept of full employment should be redefined. Employees change employers more and more often in the course of their careers. It is more and more difficult to maintain the status of «full employment», full-time for an indefinite period. Currently, the diversity of employment relations is increasing, and there are more and more possible forms of employment. Thus, according to Schmid's intention, the concept of transitional labour markets is the basis for expanding potential labour relations and it constitutes an alternative to long-term unemployment. Moreover, it prevents poverty [4, pp.29-30]. According to the cited German professor, one of the areas where transitional labourmarkets occur are movements between different types of employment. Self-employment or temporary employment agencies are part of the concept of transitional labour markets [6, p.93].

In Polish law, there are two acts governing temporary employment. These are: the Act of 9 July 2003 on the employment of temporary workers and the Act of 20 April 2004 on employment promotion and labour market institutions. In Poland, implementation of the concept of transitional labour markets, namely temporary employment, was supposed to increase flexibility as well as to affect rationalisation of personnel management in organisations. This form of work was supposed to promote the activation of the unemployed and to encourage to work even on a temporary basis. Another advantage is that it increases chances of permanent employment and it makes it easier to reconcile professional tasks with education or home [6, p.11-14]. The legislator envisaged that the law on temporary employment will contribute to a decline in unemployment and will increase the competitiveness of the economy. The temporary form of employment has no restrictions on the number of executed fixed-term contracts signed one after another. In addition, an agreement concluded between a temporary work agency and a worker, in accordance with Art. 13 of the Act 1 on employment of temporary workers, should identify parties, the type of contract, the date of conclusion of the contract, as well as indicate the employer user and the period of work performed on behalf of this user, but also employment conditions of the temporary employee, including: type of work, working time, place of work and remuneration for work, including the method of its payment [7, p.163]. Legislation in Poland quite clearly shows how agreements between temporary workers and temporary employment agencies are concluded. The same concerns relations between temporary work agencies and employer users. However, the tripartite legal relationship and the divisibility of functions of employers can introduce uncertainty in the area of legal regulations concerning temporary work. The division of roles between agencies and user employers is not too clear, what can result in shifting the responsibility in relation to a temporary employee [7, p.167].

Activities of the temporary employment agency in Poland should be assessed positively. However, the shortcoming of the Act is a solution that does not sufficiently encourage the creation of permanent jobs [8, p.190]. Besides, one can also have reservations about the fairness of agencies in relation to temporary workers in practice. In Poland, active forms of counteracting unemployment and mitigating the effects of unemployment are supposed to solve the problem of unemployment, both at the macro level and at the regional level. These forms include employment agencies as well as open trade and job fairs [9, p.20]; career counselling, training; activation allowances for the unemployed; internships and career preparation; intervention works, job agencies.

With regard to the situation before the Great Recession, the situation on the Polish labour market in 2012 was still quite difficult. The unemployment rate amounted to 13.4%. Favourable changes occurred only in the second half of 2014. The lowest level of unemployment ever recorded of 8.3% was reported in September 2016. The improvement on the labour market is related to favourable changes in the economy and it constitutes the result of new activation solutions. New solutions were aimed largely at helping young unemployed. In 2012, they accounted for almost 20% of the unemployed in general, and 13.9% at the end of May 2014. In addition, the number of long-term unemployed decreased, by 27.3%, and the average duration of unemployment was reduced, from 12.9 months in 2014 to 12.6 months at the end of 2015. These changes have helped to improve the image of Poland among other EU countries. The activity rate increased among the population aged 15-64, from 66.5% in 2012 to 67.9% in 2014, and 68% in 2015. The unemployment rate in Poland is currently lower than the EU average. The amendment to the Act introduced new forms of mobilisation directed primarily at people under 30 years of age, over 50 years of age, long-term unemployed and parents returning to work after a break related to child upbringing. Since the amendment to the Act entered into force, 87.8 thousands of unemployed were covered by new forms of support by 31 May 2016 [9, p.9]. Most people were directed to employment agencies - 23.4 thousands; 21 thousands began internships as part of the so-called internship voucher. By May 2016, 18.8 thousands (14.5%) benefited from the new forms of support, and 21.9 thousands in the same period in 2015.

The amendment to the Act was multi-threaded. The idea was to make it possible to achieve the following objectives [9, p.13]:

1. to improve the effectiveness of labour offices and the quality of services;

2. to create jobs and support parents in returning to work after a break related to child upbringing;

3. to increase the employment of young people and to reduce the average duration of their unemployment;

4. to increase the employment of people aged 50 or more and to reduce the average duration of their unemployment;

5. to prevent unemployment by increasing the share of people working in lifelong learning as a result of the creation of the National Training Fund;

6. to adjust the national legislation to the EU legislation reforming the European Employment Services network in the EU member states;

7. to increase the protection of customers of employment agencies and to reduce the reporting obligations of agencies.

Already in 2015, the situation on the Polish labour market definitely improved. The overall situation in the country was as follows: GDP increased by 3.6% per annum; economic growth increased by 3.3%. The domestic demand, which rose by 3.2%, constituted a growth factor. Total consumption was higher than in 2014; it increased by 3.1%. The investment rate amounted to 20.2%, which was slightly higher than in the preceding year. The sold industrial production increased by 4.8% in total. The number of people working in the domestic economy increased by 2.0%. Average employment in the enterprise sector was higher by 1.3%, compared to 2014. Employment increased the most in the information and communication sector - 7.6%, as well as in administrative and support service activities - 4,2%. The situation is reversed in the case of mining - a decrease in employment by 7.1%, but also in construction - by 5,8%, as well as in accommodation and catering - by 5,)%, production and supply of electricity, gas, steam and hot water - by 4.4%. Employment also fell in real estate, by 1.9%. In 2015, with regard to salaries, the average gross wage in the enterprise sector increased by 3.5%, and amounted to 4,121.41 PLN. The wage growth was reported in all activities, but mostly in professional, scientific and technical activities. The minimum wage in the year under review amounted to 1,750 PLN [10]. The number of people employed at the end of 2015 was higher by 0.3%, compared to the preceding year. The number of economically inactive people decreased by 0.5%. Just like in preceding years, unemployment in Poland in 2015 was closely related in age and education. The lowest unemployment is observed among people with higher education, i.e. specialists. According to data, only every fifth person with higher education is unemployed. Moreover, people with vocational training are in a better situation than those with general secondary education. Economic activity among youngsters and elderly remains relatively low, and it amounts to 33.2% and 26.5% respectively. In relation to the number of unemployed by gender, the number of unemployed men rapidly decreased in 2003-2007. Women accounted for over 50% of the unemployed. At the end of 2015, the number of unemployed women decreased. Nevertheless, the unemployed women make up 52.2% of the unemployed in general. Women remain unemployed longer, although they have higher education than men and are also younger than men. In 2015, the most beneficial changes related to people aged 18-24.The unemployment rate for this category of people decreased by 21.6%, and by 15.6% among those aged 25-34. However, an increase of 7.8% was recorded in the 60+ age group. The number of jobs in 2008-2010 remained low. In 2010, the number of offers increased, but then decreased again. It has been steadily increasing since 2012. In 2015, labour offices reported 1,279,000 vacancies and professional activations. The situation is the best for office workers, operators, machinery and equipment assemblers as well as unskilled employees. The situation is the worst for workers without profession, as shown in Graph 1.

Unemployed by professional groups and specialities in thousands

Graph 1. Unemployed by professional groups and specialities in thousands

Source: Appendix 3 to the MPiPS-01 report of the Polish Ministry of Labour and Social Policy on the labour market: «The unemployed versus vacancies and places of professional activation by professions and specialities».

Higher education and qualifications reduce the risk of unemployment.

2. Emigration - the Polish specifics of dealing with labour market problems

What is specifically Polish about the labour market is emigration which took on special significance after 2004. Scientific achievements concerning international migration of Poles is significant. An increased interest in this issue is associated with the change of the political system in Poland in 1989 and the Polish accession to the European Union. Research concentrated on the reasons for the changes in the international migration of Poles; factors affecting migration, both in the individual and in the international context; reasons and effects of emigration [11, p.20-22]. In literature, we find many definitions of migration. Migration is a process of spatial displacement of people, a change of residence (stay) of people who move from their place of origin (place of departure) to another destination (place of arrival) [12, p.13]. The causes of migration should be seen in a weak economic development of a country as well as in its excess of labour force. Polish migrations after 1989 have economic character. Poles frequently choose European countries. Graph 9 shows the Polish emigration in thousands.

Economic emigration in thousands

Graph 2 Economic emigration of Poles in thousands

Source: Information on dimensions and directions of the Polish emigration in 2004-2012, Central Statistical Office, 2013.

In 2006, according to Eurostat, Poles made up the largest group of immigrants. 290,000 Poles worked legally in the EU countries. They were employed mainly in construction, transport and services [13]. However, under the influence of the financial crisis in Europe, a wave of migration is weakening. There are also increasing numbers of Poles coming back from abroad. The economic consequences of migration for Poland are the following [12, p.232]: reducing the supply of labour on the labour market of origin, raising the average level of wages, transferring part of wages to families living in a country of origin, re-emigration of people with more professional experience. However, the formation of gaps in the domestic labour market, the outflow of people of working age and the brain drain phenomenon are definitely unfavourable. Today, Poland is also attracting migrants from the East, including Georgia, Ukraine or Moldova. Table 1 indicates the direction of migration of Poles and the number of migrants in thousands. market poland economic

Table 1. Directions of the Polish migration

Graph 4

Source: Central Statistical Office: Income and living conditions of the Polish population (EU-SILC 2007-2015 study report)

Trends among women are the same as among men. A slightly higher percentage of women with secondary education (around 5%) can be observed. However, the growth of women's interest in higher education is surprisingly high. In 2002, the number of men and women with higher education was similar. In 2015, there is almost 10% more women, what gives them very good prospects on the labour market. These trend lines concerning the number of people with primary and higher education are particularly noteworthy. This trend change shows that all the members of the society are increasing their qualifications. These societal trends are also reflected in the economic situation. In the years of economic growth (from 2002 to 2008 on the graph), we see a very strongly increasing trend on the side of higher education and a decreasing one on the side of primary education. In the period of crisis, we see a gentle reversal of the trend which confirms that the labour market problems translate into employees' professional ambitions. After the end of the crisis, the rate of change in the direction of rising the education level is increasing.

Today, the European Union recommend to draw attention to the cooperation between academia and the R+D industry. The emphasis is put on the transfer of knowledge from universities to the economy. This project is supposed to be a solution to the problems related to global competition on the market. In Poland, after the accession to the European Union in 2004, more and more efforts are made to commercialise knowledge and transfer it from universities to the economy. Adjusting the educational offer to the requirements of the labour market has been increasingly problematic. The same concerns the so-called «self-programming ability» coined by M. Castells [17, p.12]. It is a demand for a specific type of education offered by universities. It relates to the fact that educational profiles are mismatched with labour market requirements.

The debate on higher education is carried out in the international arena. The direction of change was given by the Bologna Process of 1999, as well as the Lisbon Declaration of 2007. In Poland, a discussion on higher education continues. It concerns the clash of two concepts: the concept of universities subordinated to knowledge and the concept of universities that are socially responsible and are looking for opportunities to serve the state and its residents [18, p.16]. In Poland, there are more than 400 higher education institutions. Unfortunately, they are not competitive in relation to other universities in the EU and, above all, in the US. Poland has still not yet created the right conditions to prioritise higher education. The country has not yet developed a long-term strategy that would pose such conditions. In summary, the Polish higher education should adapt to the dynamic changes occurring globally. Thus, it should work on transferring knowledge to the economy.

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Дані про автора

Марія Мичинська-Ковальська, доктор наук, професор,

Університет природничих наук, м. Люблін, Польща. e-mail: Maria.Miczynska@up.lublin.pl

Данные об авторе

Мария Мичинская-Ковальская, доктор наук, профессор,

Университет естественных наук, г. Люблин, Польша e-mail: Maria.Miczynska@up.lublin.pl

Data about the author

Maria Miczynska-Kowalska, prof. dr. hab.

University of Life Sciences in Lublin, Poland e-mail: Maria.Miczynska@up.lublin.pl

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