The Polish unemployment rate came in at 5.3% in June, a decrease of 0.5pp y/y, the labour ministry said in a preliminary estimate on July 4.
The estimate, which draws on a survey conducted by employment offices countrywide, shows the labour market remains tight. The June unemployment rate is the lowest in 28 years, the ministry said. That is resulting in fast-growing wages and buoyed consumer confidence, which, coupled with the government’s near-universal child benefit scheme, makes household consumption a key driver of economic growth.
Driven by consumption – also by recovering investment levels – the Polish GDP grew 4.7% y/y (in adjusted and non-adjusted terms alike) in the first quarter, defying expectations of a bigger slowdown. Growth came in at 5.1% in 2018 overall, the fastest rate in 12 years.
The rate of joblessness decrease in March was slower than the annual decline officially recorded in the preceding month. In m/m terms, the unemployment rate fell 0.1pp. In June 2018 the unemployment rate fell 1.1pp y/y to 5.9%.
The falling joblessness rate has employers voicing concerns about a lack of qualified labour in Poland, and there is a growing worry of risks to longer-term investment and economic growth. The National Bank of Poland (NBP) insists there are still labour reserves in the country.
There were 101,900 job offers available in June, the ministry said. That is a drop of 25.8% y/y and 17.8% on the month.
Rising wages – alongside with more expensive food - are finally pushing up inflation although the NBP remains cool about the accelerating price growth, expecting it would not require monetary intervention until the end of 2021.
CPI growth accelerated to 2.6% y/y in June, Poland’s Central Statistical Office GUS said in a flash estimate late last month.
Upward pressure on wages looks set to continue, however. Polish wages grew 7.1% y/y in the first quarter. Wages expanded 5.3% in 2018 overall.