“If we count the money they spend and the taxes they pay, I would venture to say that not only does Poland not lose out, but the Ukrainians are working for Poland,” said Prime Minister Mateusz Morawiecki at the recent World Economic Forum in Davos.
While the remarks somewhat contradict Morawiecki’s previous claims that Poland needs funds from the European Union to help it support refugees, they point to an optimism, shared by some economists, that the mass arrival of Ukrainian refugees – around 1.5 million to 2 million of whom are currently estimated to be in Poland – can provide a boost to the country’s labour market.
Many industries in Poland are desperately in need of that labour. Recent years have seen solid economic growth and high foreign investments due to the country’s attractive location and relatively low labour costs. In April this year, unemployment stood at 5.2%, lower than before the pandemic.
The fast recovery of the economy from the impact of Covid has increased staff shortages in industries ranging from construction and catering to healthcare and education.
According to the 2022 edition of the Occupational Barometer, a nationwide short-term forecast of the situation in various professions, there are 30 occupations in Poland for which employers will struggle to find qualified professionals.
In an effort to plug those gaps, the government has rushed to integrate refugees from Ukraine, including by relaxing requirements to enter the labour market, for example suspending the need to obtain a work permit and making it easier for certain qualifications to be recognised.
The influx of refugees could permanently add up to 440,000 workers and create additional GDP growth of 4% by 2050, according to Mateusz Urban of Oxford Economics, an advisory firm.
Since the start of the war, over one million Ukrainians have obtained Polish ID numbers, indicating they are likely to stay in Poland for a longer time. Of these, around 48% are aged under 18, while a further 45% are women of working age, according to government data.
According to Deloitte, Poland avoided a costly mistake by opening the labour market and letting the most motivated people find a job straight away. About 160,000 Ukrainians have already found a job – a high number considering that most refugees are women with children, Piotr Lewandowski of the Institute for Structural Research told Notes from Poland.
However, the war in Ukraine has also resulted in an outflow of some Ukrainian workers who were previously in Poland, especially men who have returned to defend their homeland. This has deepened the deficit in certain industries that were already suffering from labour shortages and cannot easily fill them with female employees.
The effect of the outflow is notable primarily in manufacturing, construction, logistics, and shipping, which together accounted for 66% of all work permits for foreigners issued in 2021, Robert Pater and Ewa Gałecka-Burdziak, analysts from the Bureau of Investment and Economic Cycles (BIEC), told Notes from Poland.
Ukrainians made up around 11% of construction workers and 13% in transport before the war, according to estimates by BNP Paribas bank.
A mismatch between skills and jobs
The influx of Ukrainians will help fill the staffing gaps in industries dominated by women, says Tomasz Dudek, managing director of OTTO Work Force Central Europe. But the number of offers for women, especially those with low qualifications, is lower than the demand for them. On the other hand, there are big staff shortages in occupations that require greater physical strength or special qualifications, he explains.
Even though the refugees have access to childcare, benefits and education in Poland, many Ukrainian women are looking for part-time roles to combine work and parental care, BIEC data show.
But conditions for the gradual integration of refugees into Polish society are favourable. Access to the Good Start programme, under which all students receive a one-off 300 zloty payment once a year, and nursery funding can have a positive impact on the labour market, found BIEC analysts. In addition, the refugees are eligible for child benefits of 500 zloty per child per month.
To further speed up this process, in May legislation was passed that will create a nationwide platform to match Ukrainian employees with potential employers. Users will access the platform with their national ID number, and the algorithm will match their qualifications with job adverts.
Lewandowski, however, says that more should already have been done to explain the job search process to new arrivals in Poland. “There should be some additional efforts in Ukrainian, such as TV ads to provide information on how to find a job,” he argues.
The sectors that could benefit most from the inflow of Ukrainians are healthcare (with Poland having the EU’s lowest number of doctors in relation to population), social care, tourism, hospitality and the beauty industry, according to BIEC.
Among job offers being translated into Ukrainian by public employment offices, the most common are for care workers, health professionals and customer service staff, finds BIEC. On online job boards, the most common adverts marked as being for Ukrainians are for ICT specialists, sales workers and business and administration professionals.
Refugees are also likely to apply for low-qualified and seasonal jobs to earn some income quickly. In agriculture, hiring Ukrainian workers can decrease labour costs and partially compensate the increase in fuel and fertiliser prices, say analysts.
Unfulfilled potential
From the economic point of view, refugees are coming to Poland at a fortunate time. Many firms are looking for workers, and the domestic population is ageing, further deepening the deficit in the labour market. In these conditions, Ukrainians are likely to find a job relatively quickly. But the challenge is the potential mismatch between skills and jobs.
“So far, about 50% of Ukrainians who have started working are doing very simple jobs,” says Lewandowski. The government has not collected data on the education or previous occupation of refugees, making it difficult to gauge whether people are working below their qualifications.
There is a risk that many Ukrainians will keep performing simple jobs because they need to earn a living, which is inefficient in the long run. In addition, by doing low-qualified work, they are unlikely to gain new skills that would be useful for rebuilding their country if and when they return home, Lewandowski warns.
Language can be another barrier to moving to better-paid jobs. Despite the similarities between Polish and Ukrainian, learning to communicate fluently still takes time.
Finally, there are concerns regarding the fair treatment of migrants, who often work on temporary contracts or even completely off the books. In the past, exploitation of labour has been a problem, especially in sectors like construction and agriculture. But the attitude towards refugees may be different.
“I think for a while there will be a social norm that hopefully prevents people from exploiting refugees,” says Lewandowski. However, once the wave of goodwill subsides, working conditions may become an issue.
In a recent information campaign, the Polish government reminded Ukrainians that they should not agree to take on work without signing a contract and should ensure that they fully understand what they are signing.
With the labour market suffering staff shortages, finding work is not a big challenge, but the question is to what extent refugees will be able to use their expertise and professional experience rather than wasting their potential in low-skilled jobs.
Krzysztof Inglot, founder of recruitment firm Personnel Service, says that to facilitate the integration of Ukrainians into the labour market there is a need for systematic support, such as language courses, information campaigns about available jobs, retraining programmes, and a database with refugees’ competences.
“Among refugees, there is a large percentage of people who have a diploma and are, for example, nurses, doctors, or programmers. This is a potential that should be used,” he says.
SOURCE: Notes from Poland
