[Poland] Robots replace people in the wake of minimum wage rises

As minimum wage rises continue to make workers more expensive, some Polish firms are investing in technology to remain competitive, Reuters reports on the impact climbing wages have made.

By the end of 2023, the governing Law and Justice (PiS) party intends to increase the minimum monthly wage to 4,000 zlotys, beginning with an increase to 2,600 zlotys this month or more than 15 per cent.

Henryk Kaminski from the Kon-Plast plastics factory at Stare Miasto, near Konin in central Poland, has responded to the minimum wage leap by automating some roles at his family’s business. A new printing machine will replace two staff members on each of four shift-working teams.

Mr Kaminski said, “That is a saving of eight people through implementing this type of automation.” 

It is also an example of a policy intended to raise living standards which could potentially push up prices and stifle jobs growth instead.

Kon-Plast pays all its staff above the minimum wage yet it has raised salaries as a result of January’s hike. Mr Kaminski does not intend to let employees go at this time but said the shift to automation means an increase in the workforce of about 15 per cent will now be needed to meet demand.

Around a quarter of Polish companies employing staff on the minimum wage are expecting to put recruitment on hold from January, while just under a fifth are set to cut staff, according to the findings of a recent study by human resources firm Randstad.

Nationalist PiS has pledged to improve living conditions for ordinary Polish citizens in its second term, with the 500+ child benefit programme gaining tremendous support for increasing the spending power of families.

The minimum wage increase forms part of PiS’s “politics of dignity”, a push to put the buying power of Poles closer to western European peers and move Poland’s economic model away from one reliant on cheap labour.

Credit Agricole has reportedly estimated that enterprise sector employment will be 3.5 per cent lower in 2024 than if the minimum wage had remained on its 2019 path, should wages rise as planned. This represents a difference of about 200,000 jobs.

Source: Reuters

As minimum wage rises continue to make workers more expensive, some Polish firms are investing in technology to remain competitive, Reuters reports on the impact climbing wages have made.

By the end of 2023, the governing Law and Justice (PiS) party intends to increase the minimum monthly wage to 4,000 zlotys, beginning with an increase to 2,600 zlotys this month or more than 15 per cent.

Henryk Kaminski from the Kon-Plast plastics factory at Stare Miasto, near Konin in central Poland, has responded to the minimum wage leap by automating some roles at his family’s business. A new printing machine will replace two staff members on each of four shift-working teams.

Mr Kaminski said, “That is a saving of eight people through implementing this type of automation.” 

It is also an example of a policy intended to raise living standards which could potentially push up prices and stifle jobs growth instead.

Kon-Plast pays all its staff above the minimum wage yet it has raised salaries as a result of January’s hike. Mr Kaminski does not intend to let employees go at this time but said the shift to automation means an increase in the workforce of about 15 per cent will now be needed to meet demand.

Around a quarter of Polish companies employing staff on the minimum wage are expecting to put recruitment on hold from January, while just under a fifth are set to cut staff, according to the findings of a recent study by human resources firm Randstad.

Nationalist PiS has pledged to improve living conditions for ordinary Polish citizens in its second term, with the 500+ child benefit programme gaining tremendous support for increasing the spending power of families.

The minimum wage increase forms part of PiS’s “politics of dignity”, a push to put the buying power of Poles closer to western European peers and move Poland’s economic model away from one reliant on cheap labour.

Credit Agricole has reportedly estimated that enterprise sector employment will be 3.5 per cent lower in 2024 than if the minimum wage had remained on its 2019 path, should wages rise as planned. This represents a difference of about 200,000 jobs.

Source: Reuters