Domestic companies are becoming increasingly competitive on the global market, thanks in part to their family-oriented nature, and the commitment and high competence of their employees. “We are simply good and hardworking, and in terms of technology, Polish companies are no longer lagging behind German ones,” said Zbigniew Jakubas, President of the Multico Group. As he points out, current challenges for domestic companies involve operating in a difficult macroeconomic environment, primarily the labor market and the decreasing availability of staff. “Simply put, the well has run dry. We are now considering what to do as we will need to increase our manpower by around 20% over the next year, and we don’t know where to source these employees from,” added Jakubas.
“We are facing a troublesome period in the economy – many variables, rising prices of raw materials, energy, and gas – but I wouldn’t say that we are in a crisis in Poland. We are not in crisis. Those companies that are foresighted, and have invested in development – both technological and human resource development – are doing well. Our financial and business situation is strong across the board. Of course, it would be easier for us if inflation and interest rates were lower, since every regular company grows through debt financing. But we can’t complain and blame everything on the fact that we are doing poorly. We simply face tougher economic conditions,” said Zbigniew Jakubas, CEO of Multico Capital Group.
One of the wealthiest people in Poland assesses that an even greater challenge for Polish companies than the macroeconomic environment is the labor market and a deficit of qualified staff. According to the latest report “Talent Shortage” by the Manpower Group, 72% of companies in Poland currently have difficulties filling positions with new employees possessing the desired skills (2 percentage points more than a year ago). Meanwhile, in the September survey of the Monthly Economic Barometer published periodically by the Polish Economic Institute and BGK Bank, 47% of businesses pointed to problems related to staff availability as one of the main obstacles currently hindering their operations. PIE research shows that Polish businesses – despite the prevalence of negative sentiments – still want to hire and report recruitment needs.
“It is astonishing – something we did not take into account, despite employing several thousand people – how difficult it is to find skilled workers at this time,” said Zbigniew Jakubas. “We are currently setting up vocational schools and university programs in Krakow to train engineers, as we have no people to work. Put simply, the source has run dry. It’s not about salaries, it’s about qualifications. Mistakes made 10 years ago by the government, which closed down vocational schools, are now causing problems in the industry. Therefore, it’s not inflation, nor energy and gas prices, nor pay raises, as employees should be paid decently if we wish to retain them. It’s solely and exclusively about the availability of those employees, of which there are fewer and fewer. We are currently wondering what to do, as we will need to increase our workforce by around 20% over the next year and we do not know where to source these employees from.”
According to Eurostat estimates, the unemployment rate in Poland in September was 2.6% – the same as in the previous month and 0.5 percentage points less than in September 2021. This means that Poland once again ranks second in the entire EU in terms of the lowest level of unemployment (right after the Czech Republic, where it stands at 2.2%).
However, a three-decade low unemployment rate does not please employers, with 33% of them planning to increase employment in the fourth quarter of this year. This is twice as many as the number of companies planning to cut jobs (16%) – as shown by the latest September “Employment Perspectives Barometer” by the Manpower Group. Experts indicate that the Polish labor market is currently returning to double-digit employment forecasts noted before the pandemic, and optimism about expanding staff results from new investments opening up, as well as seasonal factors related to the ramping up of operations in production, commerce, e-commerce, and logistics sectors.
The study also shows that large companies employing over 250 workers, and medium-sized organizations with a staffing level of 50-249, are most open to expanding their teams. Over the coming months, the biggest number of new job offers can be expected in the finance and real estate area, energy and utility services, transport, logistics and the automotive industry, and somewhat fewer offers are also expected in the IT and consumer goods and services sector. “Despite the ongoing challenges associated with the economic environment, inflation, and operating costs, employers in Poland wish to expand their businesses and strengthen teams regardless of industry” – comments the study.
“Poles are a capable and competent nation. We have experienced such strong growth in recent years that we are now starting to compete in foreign markets, in Germany and all over Europe, and soon perhaps all over the world. However, to meet increased orders – often by as much as 100 or 200% – we need a greater number of people,” says the CEO of the Multico Capital Group. “Of course, it’s easiest when you have money, and every sensible company tries to secure investments. We have secured ourselves in terms of machinery, computers, systems, and robots, but at present – for them to be able to work one or even two shifts – we need, say, 100, 200, or 300 more people. But this results from the fact that we are competitive in the European market, we are in an uptrend, and we need to meet increased orders we receive.”
Over the last 30 years, Poland has been one of the fastest-growing economies in the world, recording uninterrupted growth during this time. Since the beginning of the transformation, it has almost tripled its size measured in real GDP (McKinsey). The “30 years of Polish exports” report published by KUKE and SpotData also shows that in 1992, the export of goods from Poland amounted to approx. 13.2 billion dollars. Today, domestic companies earn such revenue from foreign sales within two weeks. Over the last 30 years, Polish exports have grown 25-fold; its structure has also changed: in 2001 Poland was the European leader in coal sales, in 2010 – furniture, and in 2020 – monitors, which shows that the Polish economy is moving up the value-added ladder. In total in 2020, there were over 40 industries in which Poland was the export leader among EU countries. Despite a high dependency on Germany, our country systematically increases the penetration of foreign markets, and many domestic companies have achieved spectacular success on the global markets.
Another reason for satisfaction may be the steadily increasing number of active companies, which – from the slump in 2009 until the end of 2020 – increased by 35% and reached almost 2.3 million. As indicated by the Polish Agency for Enterprise Development, this confirms the entrepreneurship of Poles, despite the serious problems that not only the Polish but also the global economy has been grappling with over the recent years.
“We have competitiveness in the form of a good tax system, as personal and transaction taxes in Poland are lower than in Germany or Western Europe. In Lithuania or Latvia, they are lower, but those are smaller countries that could afford to do that; perhaps this could also be considered in Poland. We also have competitiveness in the form of a highly skilled workforce, hence, among others, giants from the IT industry have located themselves in Poland. There are whole clusters of IT specialists in Wrocław and Krakow. We are simply good and hardworking,” said Zbigniew Jakubas. “Having several thousand employees, I am glad that we are running these businesses right here, in Poland, and that there is this kind of approach. We recently showcased a multisystemic locomotive at a trade fair and Germans from Siemens and Alstom, and other companies were in disbelief that we managed to produce and certify such a product in six years. It would take them twice as long, from the decision to execution. So this is our advantage: quick actions and highly competent people.”
The Multico Capital Group President assesses that the family character of Polish companies is also an advantage, deciding their competitiveness on the Polish and global market. According to data quoted by the Ministry of Finance, out of over 2 million private Polish enterprises, nearly 830,000 are family businesses. Most of them are in the trading industry, industrial processing, the construction industry, and professional services. Importantly, their influence on the economy is steadily increasing. While in 2009, family businesses produced about 10% of the Polish GDP, this percentage now reaches approximately 18%, which means that on average, every fifth złoty earned in the country is the result of the activity of family businesses.
“A great deal of businesses in Poland are family-run, this is their DNA, they make and implement decisions faster. We also have capable people who can implement these decisions. And that’s why we have a competitive advantage over large corporations, which are behemoths and take a while before they decide on something and then implement it. We are two steps ahead of them. This is how we win this race – through the quality preparation of people, the intelligence of these people, their hard work. In terms of technology, good Polish companies are no worse off than German ones,” said Zbigniew Jakubas. “For now, we still have the advantage that wages in Poland are lower than in Germany and Western Europe. But this gap is significantly closing. Therefore, we need to focus on development and technologies, not on wage advantages, as this is short-term policy.”
A large supply of skilled labor at low labor costs was one of the main engines of the Polish economy over the past 30 years. However, in a report (“Poland 2030: A chance to leap into the economic premier league”), consulting firm McKinsey & Company indicates that Poland now needs new growth levers. Estimates show that by the end of this decade, the working-age population will decrease by over 2 million people, and to maintain the current level of the workforce, it is necessary to ensure growth in professional activity, which in Poland is 65%, while the EU average is 74%. Maintaining further rapid development will also depend on factors such as ease of doing business, the efficiency of the tax system, and modern transport, energy, and telecommunications infrastructure, and above all – digitization and innovation.
Poland still has a lot to catch up in this area compared to more developed Western economies – in last year’s DESI ranking, it occupied only 22nd position out of 27 European Union countries, due mainly to the low domestic expenditure on research and development. According to McKinsey & Company, speeding up digitization and basing the economic system on new technologies could become a new engine for the growth of the native economy. However, in the coming years, it will be increasingly difficult to maintain the dynamic development tempo, and further success will depend on whether Poland will be able to consistently implement actions increasing innovation, streamlining the labor market, and ensuring a friendly environment for businesses and society.
