UNEMPLOYMENT IN POLAND
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- Eileen Osborne
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1 Monika Krawiec, Joanna Landmesser Warsaw Agricultural University, Poland UNEMPLOYMENT IN POLAND Unemployment is a major and widespread problem, no longer confined to specific industries or regions (though significant geographical differences persist). That is why we try to analyze in detail the situation in Poland in 2006, and to look at the means being used in the fight against unemployment. Our study is based on the results obtained by the Main Statistical Office (GUS) in the III quarter of 2006 and presented at its website ( First we would like to introduce some basic definitions which are important for this investigation. Economically active population (or labor force) includes all people aged 15 and over who are considered as employed in public and private units as well as unemployed people. Registered unemployed persons include those who are not employed and not performing any income-generating work, able and ready to take full-time employment, not attending any full-time school with the exception of schools for adults or taking extra curriculum exam with the scope of this school program exam or tertiary schools in the evening or weekend education system, and registered in the powiat 1 labor office corresponding to the person s permanent or temporary place of residence, and seeking employment or any other incomegenerating work. The registered unemployment rate is calculated as the relation of the number of registered unemployed people to the economically active civilian population, i.e., excluding persons in active military service as well as employees of budgetary entities conducting activity within the scope of national defense and public safety. The unemployment rate is given including people working on private farms in agriculture (comprising a part of economically active civilian population) estimated on the basis of the results of Census. Since The data on unemployed are collected according to their place of residence or stay, while the data on employed according to address of their place of work. Therefore the unemployment rates are not exactly precise, especially in a case of unemployment rates by powiats.. The long-term unemployed comprise persons who stayed in the register rolls of the powiat labor office for the combined duration of over 12 months in the last two years. 1 Powiat a small administrative unit.
2 At the beginning we would like to compare unemployment rates in Poland and other European countries, thus Table 1 presents unemployment rates reported in some European Union countries. TAB. 1. UNEMPLOYMENT RATE IN UE COUNTRIES COUNTRIES III VI IX XII III VI IX in % EU 25 8,9 8,8 8,6 8,5 8,2 7,9 8,0 EU 15 8,0 8,6 8,4 8,3 8,0 7,8 7,8 Austria 5,0 5,2 5,2 5,1 5,1 4,8 4,7 Belgium 8,0 8,5 8,4 8,4 8,6 8,7 8,6 Cyprus 5,1 6,1 6,2 4,9 5,3 5,2 5,0 Denmark 5,1 5,0 4,5 4,0 4,2 4,0 3,5 Estonia 7,9 8,0 7,2 6,6 5,6 6,1 4,4 France 9,8 9,6 9,4 9,2 9,6 9,2 8,9 Spain 10,1 9,3 8,8 8,7 8,8 8,5 7,8 Ireland 4,3 4,2 4,2 4,2 4,5 4,5 4,2 Lithuania 8,6 8,3 7,4 6,8 6,3 5,7 6,1 Netherlands 4,8 4,7 4,7 4,5 4,0 3,9 4,0 Germany 9,8 9,5 8,6 9,5 8,6 8,3 8,7 Poland 18,1 17,9 17,6 17,1 15,1 14,2 14,1 Czech Rep. 8,0 7,9 7,9 7,8 7,6 7,1 7,0 Slovakia 15,9 16,3 16,5 16,0 14,2 13,5 12,8 Slovenia 5,7 6,0 6,4 6,3 6,4 6,2 5,7 Hungary 6,3 7,1 7,3 7,5 7,3 7,2 7,6 UK 4,6 4,6 4,8 4,9 5,3 5,5. Source: Publication Eurostat " New Release" 143/ November 2006 In September 2006 the highest unemployment rates were reported in Poland and Slovakia while the lowest were those of Netherlands, Denmark, Ireland, Luxembourg, Austria and Estonia. The unemployment rate observed in Poland was almost twice as high as the average for 25 European Union countries. Let s analyze a long-term tendency in development of unemployment rate in Poland. The considered period of time is from 1990 through 2006 (see Fig.1).
3 Fig. 1 Unemployment rate in Poland from 1990 through 2006 Unemployment rate in Poland in % Unemployment rate Source: own elaboration on the base of data obtained from the Main Statistical Office (GUS) From 1990 to 2002 one could observe increasing tendency in unemployment rate. It reached the maximal value equal to 20% in Then in 2003 it started decreasing. In January 2007 the unemployment rate in Poland equaled 14%. Fig. 2 presents number of registered unemployed people in Poland from 1990 through Fig. 2 Number of unemployed in Poland from 1990 through 2005 Registred unemployed persons in Poland in thousand total women men Source: own elaboration on the base of data obtained from the Main Statistical Office (GUS) In the considered period the number of registered unemployed people increased from 1126,1 thousand in 1990 to 3217,0 thousand in 2002 while in 2006 in result of decreasing process it reached thousand level.
4 Compared to September 2005, a decrease in the number of the unemployed was observed in both populations: male and female. The number of men registered in the labor offices decreased over the year by thous. (i.e. by 19.2%), while the number of women dropped by thous. (i.e. by 10.3%). Fig. 3 presents number of unemployed people by sex. Fig. 3 a - in the end of month Fig. 4 a in the end of month b in % of civilian economically active population A detailed analysis of unemployment rate from April 2004 to September 2006 based on data displayed in Fig. 4 lets us state that in the last three years ( ) unemployment rate kept decreasing.
5 Fig. 5 Compared to the previous quarter, at the end of September 2006, a decline in the number of the unemployed was observed in all voivodships. The biggest decrease was observed both in pomorskie and dolnośląskie voivodships (see Fig. 5). Fig. 6
6 The unemployment rate at the end of September 2006 comprised 15.2% of the economically active civilian population, it was by 0.7 point lower than in the II quarter of 2006 and by 2.4 point lower than in September There was still observed a very high territorial differentiation of unemployment. The highest unemployment rate was observed in voivodships: warmińsko-mazurskie (23.6%), zachodniopomorskie (21.5%), lubuskie (20.0%) and kujawsko-pomorskie (19.4%). The lowest unemployment rate characterised voivodships: małopolskie (11.6%), wielkopolskie (12.1%) and mazowieckie (12.2%) see Fig.6. The highest number of the newly registered unemployed was observed in September (248.8 thous.), while the lowest - in August (219.5 thous.). Over the III quarter of 2006, the highest increase in unemployment was observed in voivodships: śląskie (by 76.8 thous persons), mazowieckie (by 73.0 thous.), dolnośląskie (by 60.3 thous.), and wielkopolskie (by 58.6 thous. persons). The majority of the newly registered constituted women, their share in the total number of the newly regstered in the labour ofices amounted to 52.8%. Among the persons newly registered in September % lived in rural areas (last year 38.2%). Fig. 7 To the group of people whose situation on the labor market was specific belong, i.e., the long-term unemployed persons. Their share in the total number of the registered amounted at the end of September 2006 to 65.4% ( thous. persons). Persons aged up to 25 years constituted 21.9% of the total number of the unemployed (517.8 thousand persons), while persons aged over % (425.6 thous. persons).
7 The share of registered unemployed persons who did not have occupational qualifications amounted to 29.6% of the total number of the registered unemployed (700.0 thous.); 3.8% comprised single parents (88.8 thous), while 3.1% constituted disabled persons (72.2 thous. persons). In the III quarter of 2006, the highest long-term unemployment rate was observed in voivodships: zachodniopomorskie and warmińsko-mazurskie, whereas the lowest rate was observed in voivodships: mazowieckie, wielkopolskie, podlaskie, śląskie, małopolskie (see Fig. 7). The long-term unemployment is more often observed among women. Over a half (54.4%) of the women registered in labour offices at the end of September 2006 had been seeking employment for more than 12 months. Among men at the end of III quarter of 2006 the percentage share of the longterm unemployed amounted to 45.0% (see Fig. 8). Fig. 8 Structure of unemployed by duration of unemployment and sex. Fig. 9 Structure of unemployed by age and sex
8 The youths still remain a group mostly affected with unemployment. At the end of the considered period, the largest group among the unemployed constituted persons aged years. Their share in the total number of the unemployed decreased and amounted to 27.6%. Persons aged up to 24 years constituted 21.9% of the total number of the unemployed. The percentage share of registered unemployed persons at the age years comprised 19.8%, years 24.4%, while persons aged over 54 constituted 6.3%. (see Fig. 9). The highest percentage share of the unemployed aged between 25 and 34 years in the total number of the unemployed was observed in voivodships: lubelskie (31.1%), podkarpackie (30.7%), świętokrzyskie (29.3%), małopolskie and wielkopolskie (by 27.9%), while the lowest one was observed in voivodships: opolskie and podlaskie (by 25.8%) and dolnośląskie (26.1%). Significant differences also persist between the unemployment levels in urban and rural areas. Experts point out that unemployment in rural areas is different from that affecting urban areas. Unemployment in rural areas tends to be of a more permanent character, and the labour market in small municipalities and villages is much less open to change. As much as half of all unemployed people are inhabitants of rural areas who are not farm holders and were usually previously employed in the stateowned agricultural farms (PGRs). They accounted for 45.6% of the total registered unemployed in December 1998, 43.7% in December 2000 and 42.1% at the end of March This situation is a legacy from the previous system and the first stage of transformation. According to GUS, a total of 800,000 people were employed in state-owned farms in the second half of the 1980s. However, a large number of these farms went bankrupt after the political system change in 1989 and 1990, entailing a rapid increase in interest rates on outstanding credits, the abolition of the state monopoly over the import of foodstuffs, the reduction of customs duties etc. The former employees of these farms turned out to be the most passive and helpless social group in Poland. Helping this group is one of the main challenges for social policy in Poland. Fig. 10 Unemployment rate in rural areas - IX 2006 % POLAND Dolnośląskie Kujawsko-pomorskie Lubelskie Lubuskie Łódzkie Małopolskie Mazowieckie Opolskie Podkarpackie Podlaskie Pomorskie Śląskie Świętokrzyskie Warmińsko-mazurskie Wielkopolskie Zachodniopomorskie Source: own elaboration on the base of data obtained from the Main Statistical Office (GUS)
9 The highest unemployment rate in rural areas was observed in those voivodships where the former state-owned farms had been located: zachodniopomorskie (33.4%), warmińsko-mazurskie (31.6%), lubuskie (28.8%) see Fig. 10. In absolute terms, after 1994 the number of workers in agriculture in Poland dropped by almost 600 thousands people. Because of the high unemployment in Poland, many of the farm workers who have been laid-off find it very hard to get new jobs. It is argued that the reason for this is the low level of education: more than 40% of rural labour have only elementary and lower education, while for example in construction it is 16%, in industry 13% and in services 8%. The next 30% of agricultural work force have only basic vocational education (Wiśniewski Z., Oczki J.: Polish labor market and migration potential discussion papier N o 49, Universität der München, 2005). Both hidden unemployment in Polish agriculture and a large number of unemployed in rural areas facing black job prospects may be an important source of migrants to the EU-15. Almost 80% of Polish land is used by small family farms. Empirical evidence indicates that these small farms have not experienced rapid restructuring and productivity growth over the past years. They are still characterized by substantial hidden unemployment, low skills and face difficult access to resources. These factors will be an important additional constraint on future productivity growth. However, since Poland has a particularly high rural population among all new members of the EU the restructuring process may lead to a persistence of high unemployment rate and increase in migration potential in the medium-term. Fighting unemployment Unemployment in Poland is no longer a problem confined to specific industries or regions; it is assuming a universal aspect. Recent research indicates that more than 53% of all Poles are afraid that they may lose their jobs, and almost 80% maintain that, were this to happen, they would encounter significant difficulty in finding a new one. The institution in the 'front line' of the fight against unemployment is the network of state labour offices. In 2002, the Ministry of the Economy, Labour, and Social Policy (Ministerstwo Gospodarki, Pracy i Polityki Społecznej) started to implement special programmes funded by the Labour Fund (Fundusz Pracy), their main objective is the 'vocational activation' of people belonging to risk groups in local job markets. Almost 1/3 of unemployed taking part in these programmes were women, almost a half were long-term unemployed, and more than a half were residents of rural areas. A significant proportion of the programmes beneficiaries was also accounted for by people aged up to 24, school-leavers and people not holding any formal vocational qualifications. Decrease in unemployment which is being observed in Poland at the moment is generally a result of the economic growth, but the main reason of this seems to be intensive migration process. It is estimated that in the last two years almost one million people have left Poland. The main migration directions were Great Britain and Scandinavian countries.
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