The Polish economy has doubled in size over past two decades as real GDP per capita grew by 3.9% between 2005 and 2021, faster than neighbouring Central and Eastern European countries and twice the OECD average. Continued productivity convergence is likely to lead to higher growth than the OECD average but will gradually slow. Polish companies face challenges of moving up the value chain, population ageing and a shortage of skills. Further improvements in the business environment, such as reforms to the governance of state-owned enterprises, lowering regulatory barriers in services and adopting a public integrity strategy, could help boost competition and sustain continued productivity growth. Polish firms are less innovative than firms in some neighbouring countries and public supports have been in part re-oriented towards a greater reliance on tax incentives. Skills shortages should be addressed with more training and upskilling, especially among small and medium-sized companies, as well as through targeted awareness campaigns and a comprehensive migration strategy.
OECD Economic Surveys: Poland 2025
Abstract
The Polish economy has doubled in size over the past two decades and caught up significantly closer to its regional peers in terms of labour productivity and employment. In per capita terms, real GDP grew at 3.9% between 2005 and 2021, faster than neighbouring Central and Eastern European countries and at twice the OECD average. This helped Polish living standards converge from around half of OECD levels to 80% by 2021. These improvements were largely driven by productivity growth (Figure 4.1). Looking ahead, continued productivity convergence is likely to lead to growth higher than the OECD average but will gradually slow down. To remain attractive for foreign investment as an entry point to the EU market, Poland needs to manage structural changes such as decarbonisation and labour force ageing. As Polish companies move up the value chain, policies that support innovation and upskilling will be increasingly important. The chapter focusses on policies to improve the business environment and innovation, and to address skills shortages through training and migration.
Note: CEE refers to the average of Czechia, Hungary and the Slovak Republic.
Source: OECD Analytical database and OECD Quarterly National Account database.
Productivity growth has been broad-based across the economy, with solid average yearly growth of 3.6% in distribution, 2.25% in business services and 2.6% in manufacturing since 2015 (Figure 4.2). Up to 2022, the ICT sector experienced the fastest growth, although it accounts for only around 7% of gross value in the economy. Increasing trade openness is helping the productivity convergence with exporting firms having experienced faster productivity growth than the average. Over a third of domestic value added is driven by foreign demand. Nevertheless, at around 10%, the share of high-tech exports is moderate.
While FDI flows have remained solid, overall business investment rates have stagnated since 2009. Poland’s industrial policy has been built around attracting foreign investors to ‘special economic zones’ with infrastructure, grants and tax incentives, targeting specific sectors, regions or value chains, and carried out mainly by the investment promotion agency (PAIH). In 2023, inward FDI stock stood at 40% of GDP, slightly lower than in its regional peers and OECD average but higher than in Germany. The investment is concentrated in sectors with medium productivity and high R&D expenditure, such as manufacturing, ICT and financial services (OECD, 2025, forthcoming). Business investment is lower than the EU average and regional peer countries, with relatively low investment in intangibles and ICT equipment (ING, 2024; OECD, 2023). This has been partly attributed to stronger past investment in real estate and offset by public investment, supported by the EU funds (Hagemejer et al, 2021). As labour becomes more expensive, boosting output and productivity will require further investment in automation and digitalisation.
Note: CEE refers to the average of Czechia, Hungary and the Slovak Republic.
Source: OECD-Compendium-of-Productivity-Indicators-2024 database.
Exports, inward foreign investment and participation in European value chains have played a key role in supporting Polish production and productivity growth. Exports rose from 27% of GDP in 2000 to 63% in 2022, and in recent years trade has been relatively resilient, growing faster than GDP. However, competitiveness had declined since the energy crisis due to rising wages with unit labour costs increasing by over 20%, faster than the OECD average and somewhat more than in neighbouring countries. While Poland enjoyed some gains in competitiveness in the years before the pandemic, the impact of these developments needs to be carefully monitored. Poland’s main trading partners are in Europe, with the euro area accounting for half of both goods and services exports (Figure 4.3). The main export goods are machinery and transport equipment, vehicles and vessels. Services, accounting for around a third of total exports, are dominated by transport and tourism with a growing importance of business services. Poland is well connected to German global value chains (GVC), both in terms of forward and backward participation (WTO, 2023). Nevertheless, Poland’s downstream position, focused on assembling imported intermediate inputs, limits local procurement and weakens linkages between foreign multinationals and domestic suppliers (OECD, 2025, forthcoming). Further diversification of Poland’s activities and trade partners may be beneficial to widen the range of opportunities and to reflect evolving demand.
Share of exports by sector and destination, 2023 or latest year available
Note: In Panel C, Others include crude materials, beverages and tobacco, animal and vegetable oils, and commodities and transactions. In Panel D, Others include R&D services, financial services, insurance and pension, construction services, and cultural services.
Source: OECD International Trade Statistics.
Firm-level analysis illustrates that companies exporting most of their production experienced high growth rates of labour and total factor productivity over the period of 2008-21 and also in the more recent years compared to other firms (Box 4.1) (Statistics Poland, 2022). Over a third of high-growth firms, defined as those whose revenues increased by more than 70% in past three years, were industrial exporters (Statistics Poland, 2024). Furthermore, the data suggest that firms facing greater competitive pressures have seen strong productivity growth since 2014 (Box 4.1).
Micro-aggregation of firm-level data provides valuable insights on the drivers of productivity since 2014. Experimental statistics from a panel dataset compiled by Statistics Poland based on the Annual Enterprise Survey has been made available for this Economic Survey and covers non-financial companies with 9 and more full-time workers, using a firm-level Cobb-Douglas production function to construct measures of productivity (Annex A).
The dataset shows a picture similar to the national accounts of steady productivity growth across the pre-period COVID (2014-18) and more recent years (2019-22) (Figure 4.4). The aggregate productivity growth is above the economy-wide based on national accounts (SNA), which can reflect the fact that the sample excludes micro-firms and other parts of the economy included in the SNA. The steady labour productivity growth holds across firms of different sizes and for domestic firms and foreign-owned companies. The largest contribution to overall annual TFP growth over the period has come from manufacturing, professional and administrative services as well as ICT in more recent years.
Note: Labour productivity calculated as a ratio of gross values added to number of full-time employees (Equation (2) in Annex A). Experimental statistics compiled from a panel of firm-level data collected and produced by Statistics Poland.
Source: Statistics Poland.
The data suggests that firms facing greater competitive pressures have seen strong productivity growth since 2014. Companies in sectors with high competition, defined as having a Herfindahl-Hirschman index of concentration below 0.1, experienced higher labour productivity and TFP growth. Similarly, export-oriented firms, defined as those with more than 50% of revenues received from foreign markets, experienced stronger productivity growth than those with moderate or no export activities. State-owned enterprises showed the second slowest productivity growth of any of the sub-groups considered (Figure 4.5). A more granular exploration of the data could help to understand how far these differences are driven by variation across sectors and how much by differences in firm characteristics within each sector.
Note: Labour productivity calculated as a ratio of gross value added to number of full-time employees (Equation (2) in Annex A). Experimental statistics compiled from a panel of firm-level data collected and produced by Statistics Poland.
Source: Statistics Poland, 2024.
The business sector is dominated by micro-firms, which account for more than 30% of employment, while large firms account for a similar share of employment but create half of value added in the economy (Figure 4.6). A lower share of medium-sized companies compared to OECD average, in terms of employment and turnover, points to challenges in scaling up operations (OECD, 2025, forthcoming).
Note: The year of reference is 2020 (or the latest year available) and data refer to business economy, excluding financial and insurance activities. Micro firms employ 1-9 persons, small/medium firms employ 10-249 persons and large firms employ 250 and more persons.
Source: OECD Structural Demographics and Business Statistics (SDBS) and Trade by Enterprise Characteristics (TEC) databases, 2023.
Lowering regulatory barriers to competition in services and network sectors
Poland’s regulatory framework is pro-competitive, but some areas of the economy would benefit from lowering of regulatory barriers further. This can help reallocate resources to the most productive firms, underpinning continued productivity growth. The OECD’s Product Market Regulation (PMR) indicators, which assess the alignment of a country’s regulatory framework with international best practices, suggest that Poland’s regulation of product markets is broadly favourable to competition, with the overall restrictiveness below the OECD average and similar to Denmark and France (Figure 4.7).
Nevertheless, barriers to competition are higher in some parts of the services sector. Regulated professions employ about 20% of the workforce in Poland. High costs in these activities impact Polish consumers and firms, including the competitiveness of Polish manufacturing firms given their use of services inputs. Professions such as such as lawyers, notaries and architects are subject to price regulations that do not apply in many OECD countries (Figure 4.7). There are geographical restrictions on notaries, restrictions on advertising by lawyers and limits on setting up practices with other professions (OECD, 2022). Membership of a professional body is mandatory for notaries, architects and civil engineers. Occupational entry regulations for those providing personal services (such as aestheticians, bakers, butchers, electricians, hairdressers, painter-decorators, plumbers, driving instructors and taxi drivers) seem relatively restrictive, mainly due to qualification requirements (von Rueden and Bambalaite, 2022).
In the network sectors, state intervention in electricity markets remains higher than in some other OECD countries. While Poland complies with the EU regulation on the legal separation between various segments of the electricity market, the largest companies in generation, retail, distribution and transmission are state-owned and retail electricity prices are regulated for both domestic and non-domestic consumers. Regulated prices reduce the financial incentives to switch suppliers. Indeed, switching rates for households are among the lowest in the EU and the rate for commercial consumers is also well below the EU average (IEA, 2022).
Product Market Regulation indicators, scale 0 (from least) - 6 (to most) stringent
Note: The 5 most competition-friendly OECD countries correspond to Australia, Canada, Chile, Colombia and United Kingdom for Lawyers, Costa Rica, Ireland, The Netherlands, Sweden and United States for Notaries, Denmark, Finland, The Netherlands, New-Zealand and Sweden for Architects, Belgium, Denmark, Finland, The Netherlands and Sweden for Civil engineers.
Source: OECD Product Market Regulation database.
Strengthening the insolvency framework
The Polish business sector is dynamic, with healthy entry and exit rates (Figure 4.8). The design of the insolvency regime, which allows for reallocation of resources from failing businesses, matters for productivity growth as it can help shift capital and employees to more productive firms and facilitate technological diffusion by promoting experimentation (McGowan et al., 2018; Andrews et al., 2017). Such impacts are likely to be greater in sectors based on intangible capital (Demmou and Franco, 2021).
2022 or latest year available
Source: Eurostat.
During the pandemic, the insolvency framework was temporarily relaxed. More recently, with the weak economic developments in 2023, bankruptcy filings increased by 15%, although they remain at around half of the level in 2015. Poland has yet to implement the EU Directive bringing certain features of the insolvency framework closer across EU countries. In implementing those measures, it can draw on the experience of other OECD countries in lowering the time to discharge, introducing early warning systems, lowering the length of ‘stay on assets’, a tool that prevents actions by creditors to collect debts from a debtor that declared insolvency to keep operations of a firm going (Figure 4.9). It should also allow for court specialisation, as currently the first instance district courts deal with both simple personal bankruptcy cases as well as complex business cases of corporate restructuring. The estimated time to resolve litigious civil and commercial cases at first instance has been growing over the years and was the fifth longest in the EU in 2022 (EC, 2024a).
OECD insolvency indicator, scale 0 (best practice) - 1 (most stringent), 2022
Source: OECD Insolvency Indicators database
Improving governance of state-owned enterprises
Public ownership of firms remains higher than in most other OECD countries, while firm-level data suggest that their labour productivity growth was weak during 2014-22 (Box 4.1). The public sector holds over 13% of the stock market capitalisation and half of the top 10 publicly traded companies at the Warsaw Stock Exchange have some degree of state ownership. State-owned enterprises (SOE) include one of the biggest banks and an insurance company, as well as various energy companies and utilities. Recent audits of several key SOEs point to subpar management practices (Rzeczpospolita, 2024). While there is a growing trend towards centralisation of state ownership functions among OECD countries, the governance of Polish SOEs relies largely on a decentralised model. This means that while certain SOEs are under the direct supervision of the office of the Prime Minister, others fall under several line-ministries that set and monitor corporate objectives and exercise ownership rights with a limited coordinating role for the Prime Minister. Following the change of government in 2023, replacements in the supervisory and management boards have been launched, including an introduction of open competitions, which is welcome. A new “Code of Good Practices” has been put forward by the Ministry of State assets that includes a strengthening of the selection process for board members (Rzeczpospolita, 2024).
OECD Product Market Regulation indicator, 2023, scale 0 (from least) - 6 (to most) stringent
Note: The 5 most competition-friendly OECD countries correspond to Iceland, The Netherlands, Norway, Slovenia and Sweden for Quality and Scope of Public Ownership and Finland, Italy, Norway, Slovenia and Sweden for Governance of state-owned enterprises (SOEs).
Source: OECD Product Market Regulation database.
The oversight of state-owned enterprises and their governance should be better aligned with international good practice identified in the OECD Guidelines on Corporate Governance of State-Owned Enterprises (EC, 2019a, OECD, 2020a). SOEs in Poland are not required to put in place internal audit functions, unless specified by a listing or other requirement. While all SOEs publish regularly individual reports that include both financial and non-financial information, an aggregate annual report about the SOE portfolio could strengthen the oversight of state ownership. The institutionalisation of non-partisan appointment committees for the selection of candidates for management and supervisory boards and minimum requirements for the number of independent SOE board members would improve the management selection process and minimise the risk of political appointments. Disclosure of remuneration of board members and key executives could be improved, as most OECD countries require SOEs to engage in some form of disclosure, but there is no such requirement in Poland. Given the high prominence of SOEs in the economy, linking explicitly their ownership with broader national objectives on climate goals could advance the green transition. Several OECD countries such as Finland, Germany or France have such policies in place (OECD, 2024a). The authorities should regularly review the necessity of state ownership and simplify the process of selling state assets, as currently each transaction is currently subject to high-level political approval from the Council of Ministers (OECD, 2020a).
Rebuilding trust in government by strengthening public integrity
The experience of corruption among the population and businesses is low and expert perceptions of control of corruption are on a par with regional peers (Figure 4.11) (OECD, 2022). Nevertheless, public trust in government has been low. The recent change of government led to several high-level investigations of former public officials. Several features of the public integrity framework could be improved (OECD, 2024a). Firstly, there is no overall strategy at the central level. In terms of internal risk and control, Poland meets the majority of OECD standards on regulations but only a half of them gets implemented. Although the legal framework for internal audit is strong, only 18% of budget organisations were audited internally during 2016-21. Moreover, Poland does not track data on the implementation of internal audit recommendations (OECD, 2024a).
Note: Panel A shows Transparency International’s Corruption perceptions index. B shows the point estimate and the margin of error. Panel D shows sector-based subcomponents of the “Control of Corruption” indicator by the Varieties of Democracy Project. In panel C, peer countries consist of Czechia, Hungary and the Slovak Republic.
Source: Panel A: Transparency International; Panels B & C: World Bank, Worldwide Governance Indicators; Panel D: Varieties of Democracy Project, V-Dem Dataset v12.
In lobbying, conflict of interest and political finance, the regulation and standards follow international norms, but implementation is lagging best practices (Figure 4.12) (OECD, 2024b). The Ministry of Interior and Administration is responsible for overseeing lobby activities and a lobbying register is available online, but it only includes information on the name of the lobbyist, not on the domain of intervention, the type of lobbying activity or the piece of legislation targeted as is the case in OECD best practice countries. While ministers, members of parliament, senior judges and top-tier civil servants of the executive branch submit an interest declaration, the central authority does not fully and systematically track such submissions. Poland fulfils most of the OECD standards on political finance in terms of regulation. Yet, candidates cannot be held personally accountable for violations and there is no ban on anonymous donations. Some political parties do not submit elections-related accounts on time. Moreover, the National Election Commission, the independent body overseeing the financing of political parties and election campaigns, does not publicly disclose minimum information on the different types of sanctions issued.
OECD Public Integrity Indicators, % fulfilment of criteria for regulations and practice, 2022-2023
Note: The first two indicators on strategy refer to a strategy that was in place until 2022. Currently, there is no overall strategy.
Source: OECD (2024b).
Enforcement of the OECD’s Anti-Bribery Convention has been weak, with no convictions and corporate liability virtually impossible (OECD, 2022b, OECD, 2024c). A revision of the widely used so-called impunity provision, under which a briber can escape liability if (s)he discloses all substantive circumstances of the crime to a law enforcement authority, has been announced. However, details of this reform have not yet been made public. Poland is largely compliant with Financial Action Task Force’s recommendations on anti-money laundering and terrorist financing measures (Figure 4.13).
Note: Panel A summarises the overall assessment on the exchange of information in practice from peer reviews by the Global Forum on Transparency and Exchange of Information for Tax Purposes. Peer reviews assess member jurisdictions' ability to ensure the transparency of their legal entities and arrangements and to co-operate with other tax administrations in accordance with the internationally agreed standard. The figure shows results from the ongoing second round when available, otherwise first round results are displayed. Panel B shows ratings from the FATF peer reviews of each member to assess levels of implementation of the FATF Recommendations. The ratings reflect the extent to which a country's measures are effective against 11 immediate outcomes. "Investigation and prosecution¹" refer to money laundering. "Investigation and prosecution²" refer to terrorist financing.
Source: OECD Secretariat’s own calculation based on the materials from the Global Forum on Transparency and Exchange of Information for Tax Purposes; and OECD, Financial Action Task Force (FATF).
Broadening access to finance
The availability of finance has been good for most firms, although some SMEs face more limited access to funding. Firms tend to finance most of their activity out of retained earnings as well as external finance. In recent years, external finance has mostly consisted of trade credit and leasing, which is more common in Poland than in other European countries. Demand for credit has fallen significantly since the start of the pandemic, but remains available albeit at higher interest rates. Banks continued to approve over 90% of loan applications. However, a minority of SMEs report more limited access to finance as a result of insufficient capital or guarantees as well as too much paperwork (European Commission, 2024a). The public development bank’s (BGK) ‘de minimis’ programme provides loan guarantees to around a quarter of Polish entrepreneurs. To reduce informational asymmetries in loan applications a credit registry for SMEs could help.
The financial system can be developed further to broaden funding channels. Venture capital is important in supporting and funding new and innovative firms. Funding has increased by more than ten-fold since 2018 to around PLN 2 billion in 2023, supported by the Polish Development Fund that has co-invested alongside private equity funds (Kuchar et al, 2024). However, foreign investors accounted for only around 10% of transactions in 2023. Poland could incentivise foreign venture capital investment, as this could boost funding and raise expertise, particularly at later financing stages. Equally important will be to improve the attractiveness of the Polish stock market. The Warsaw Stock Exchange has not kept pace with the economy. Total capitalisation relative to GDP has dropped by a third over the past decade to 22% in 2023, less than half of the EU average. Better governance of listed state-owned enterprises, tax relief for long-term investments, and easier reporting requirements for initial public offerings could make the stock market more attractive to foreign investors and prospective firms.
Innovative capacity can be boosted further
Despite dynamic business sector and rising private R&D investments the innovation capacity remains low. In 2022, the gross domestic expenditure on R&D reached 1.5% of GDP (Figure 4.14). The share of companies innovating either in terms of product or processes remains well below the EU average (European Commission, 2024b). Polish businesses were half less likely to introduce product and business innovations than their European counterparts. At the same time, investment in intangibles has been lagging and, at 0.5% of GDP, public R&D investment has been muted. Small and medium-sized enterprises in manufacturing, which are among the most connected to foreign multi-national enterprises, encountered the highest barriers to developing innovation and adopting new technologies. These barriers included high costs, difficulties in obtaining public grants or subsidies, and skills shortages (OECD, 2025, forthcoming). The number of researchers (per capita) has increased but lags Czechia or Germany. While the overall number of international students has doubled between 2014-20 and foreign academic staff has also increased in recent years, the low innovation potential has been attributed to low internalization of the academic sphere and a lack of collaboration among innovative companies (European Commission, 2024).
Note: In Panel A R&D expenditure refers to gross domestic expenditure on research and experimental development (GERD). In Panel B indirect government support through R&D tax incentives refers to government tax relief for business R&D (GTARD) and government-financed business expenditure on R&D (BERD)
Source: OECD MSTI database; and OECD R&D tax incentives database.
Direct public funding for R&D remains prevalent, also in the business sector (Figure 4.14). Nevertheless, tax reforms in 2016 and 2020 introduced generous tax incentives for R&D investment. In 2023, Poland had the second highest implied tax subsidy rate on R&D in the OECD. Up to 200 % R&D costs can be deducted, including investments in energy-savings improvements, recyclability of materials, as well as expenses for industrial innovations such as maintaining and obtaining a patent, and robotisation. The authorities have published explanations to help guide companies in how to claim the reliefs. The number of taxpayers using such tax incentives has increased steadily over the years, with claims reaching 0.26% of GDP in 2023, double the share in 2017 (Business Plus, 2024). Intellectual property box tax relief has been in place since 2019. To allow startups and companies that initially do not make a profit to benefit, the tax incentives could be turned into a carry-over, as done for instance in Italy. Moreover, administrative complexity of these incentives remains a challenge for SMEs and should be streamlined (OECD, 2025, forthcoming). The impact of the more generous tax subsidies and the scope for further re-orientation towards taxes should be carefully evaluated.
Direct public support for business R&D remains important. Two central institutions, the National Center for Research and Development and Polish Academy for Enterprise Development, cofinance innovative projects both in the business and academia from research and development to commercialization phases. Other bodies focus on academic research, start-up companies and programmes to foster cooperation of start-ups with medium and large enterprises and ‘sandboxes’ in certain industries such as fintech also exist. Research, development and innovation in small and medium sized companies are targeted by the PARP agency, a governmental body tasked with supporting SMEs. While there is a plethora of policies and programmes aimed at enhancing the productive and innovative capacities of SMEs, administrative burden of applying for public support remains an obstacle. Streamlining access to technical support and increasing awareness of these programmes could help facilitate SME access to existing business support (OECD, 2025, forthcoming). Regular evaluation and monitoring of the various programmes, including the tax incentives, should help to prioritise and improve them over time.
Persistent skill shortages limit continued productivity growth, in particular in the context of population ageing. The working age population has been falling steadily since 2010 to a greater extent than in the average OECD country. Meanwhile, the trend employment rate has been increasing, as a result of a growing economy, improved education and female labour market participation together with rising labour demand. At the end of 2023, 72.7% of the working age population were in the labour market, close to the OECD average, but below neighbouring Czechia and Germany (Figure 4.15). Participation rates of older workers are below the EU average so some further resources could be mobilised among the elderly (Figure 4.15). Additional reserves of labour could be drawn from the agriculture sector, where around 10% of employees work, self-employed, and disabled, but up-to-date skills are likely to be an obstacle.
Source: OECD Labour Force statistics.
Equipping workers with strong and relevant skills
Despite recent improvements in educational attainment, significant skills gaps remain. Poland ranks among the top performers in the international students PISA tests (Figure 4.16). Since 2000, the share of low educated adults has fallen more than threefold and is now among the lowest in the EU while the share of young adults with tertiary education has tripled. However, only 12% of adults have high-level skills and 27% low-level skills, which compares unfavorably with Poland’s regional peers (Figure 4.16). A recent survey found that only 18% of the working age population can understand a text of more than 25 pages and 11% can do advanced math, both shares below the EU average (CEDEFOP, 2022). Poland lags also in terms of digital and foreign language skills. Digitalisation offers new growth opportunities but requires adequate skills. Managerial skills, key to implementing new technologies, are often lacking (OECD, 2023). Estimates based on Sorbe et al. (2019) suggest that closing a quarter of the gap with the best performing countries in digital adoption could raise productivity levels by as much as 9% after three years.
Note: 1. Average of percentage of adults scoring at PIAAC literacy or numeracy proficiency level 4 or 5, or scoring at problem solving in technology-rich environments level 3 or 4.
1. For Poland, caution is required in interpreting results due to the high share of respondents with unusual response patterns. See the Note for Poland in the Reader’s Guide.
2. Data for Belgium refer only to Flanders, and data for the United Kingdom refer only to England.
Source: OECD PISA and PIAAC databases.
Poland faces similar issues around adult learning as other OECD countries: those with high skills and working in large companies tend to participate in adult learning, but those that need it the most, low skilled and/or working in smaller businesses, do so less frequently. Moreover, given the prevalence of small and medium-sized companies, which tend to lack the knowledge of and capacity to offer upskilling opportunities for its employees, public interventions should focus on these segments of the economy (OECD, 2021). Only around 20% of small companies provided continuing vocational training, one of the lowest shares in the EU, while in large firms this share was four times larger. Participation in life-long learning is low, although national survey data based on a broader definition of adult learning display higher rates than LFS surveys (Figure 4.17) (OECD, 2022a). Low participation rates have been attributed to low demand, rather than a limited supply of training opportunities, with a lack of perceived need and barriers such as family responsibilities holding back demand.
The importance of adult education is well recognised in Poland. The latest policy strategy (“Integrated Skills Strategy 2030”), adopted in 2020, builds on an earlier analysis in the OECD Skills Strategy (OECD, 2019). In addition to the National Training Fund, financed by a payroll levy on employers and with a budget of around 1% of GDP that supports employer-initiated training, considerable funding from the EU is earmarked for adult education in terms of acquiring basic and digital skills to promote social inclusion. In the past, low awareness and administrative complexity have hindered the participation of firms, while the budget is limited. PARP also supports SMEs’ human capital development. It offers a wide range of training programs via its e-learning portal (PARP Academy) that has around 270 000 users and issued some 230 000 training certificates. Another online tool that allows regional authorities to allocate funding for specific adult-learning programmes that the agency offers has been introduced. To attract adults to non-school environment, often seen as more appealing for adult learning, over a hundred local community centers have been established (OECD, 2023). Moreover, Poland is currently piloting a project of individual training accounts, which is welcome given that up to 40% of workers with low education levels are on temporary contracts, one of the highest shares in the OECD (OECD, 2020). The programme will be rolled out to the working age population in 2027-28.
Note: 1. Adults aged between 25 and 64 enrolled in education or training over the last twelve months. 2. Participation rate of adults who are unemployed (with education up to the first cycle of secondary education or inactive in Panels C and D) compared to the participation rate of all adults.
Source: Eurostat (2024).
Financial incentives can help to reduce the lack of financial or human resources, which are among the main obstacles that SMEs face in terms of investing in human capital (OECD, 2021). In Poland, employees can deduct training costs up to a certain threshold from their tax liability, while employers can apply for funding from the National Training Fund. Experience of OECD countries suggests that financial incentives need to have minimal administrative burden, should be easily adaptable to new and emerging skills, involve social partners, and be monitored and evaluated. Almost 20 sectoral skill councils, where the business and academic and public sectors meet, are in operation already with more in the pipelines. The councils issue recommendations on training offered by the PARP academy but also more widely in the academia. Similar arrangements for engaging with key stakeholders exist in Chile, or Korea and can be helpful in improving the responsiveness of the skills system in general.
Developing a migration strategy to address skills shortages
Facilitating the immigration of skilled workers could play an important role in addressing local skills shortages as well as improving business internationalisation. After two decades of strong outflows, Poland has become a destination country in recent years, with the largest share of foreign-born workers coming from neighboring Ukraine and Belarus (Figure 4.18). The impact of migrants on the economy has been estimated at around 0.24 percentages point annually for the period 2015-2023 (CASE, 2024, forthcoming). Currently, migration policy is employer-driven, determined by a job offer and based on temporary permits. For a high-skilled migrant, the initial work permit is for three years, with a renewal possible for up to six years, while application for a permanent residence is possible after 5 years. While the initial work permit duration and renewal is comparable to other countries in the region such as the Czech Republic, it is lower than in Germany or Canada. Edibility for permanent residence is also shorter in countries such as Canada, New Zealand or Australia. Work permits that are linked to a specific employer and a position limit labour market movements. Access to regulated professions is more stringent than for instance in the Baltic countries. Conditions on work permits have been streamlined in recent years and the list of countries and “shortage” occupations that was covered by so-called accelerated visa application procedure has been extended (Duszcyk et al, 2024).
Note: Light blue columns are unstandardised data.
Source: OECD International Migration Outlook 2024.
A special pathway for attracting ICT workers from third countries outside the EU exists, and other sectors could benefit from such arrangements. The current policies do not include any integration measures and lack a long-term vision on integration of migrants and their families, which does not bode well for Poland in the global competition for talent. Both the duration of work permits and conditions of family reunification are important in talent attraction and retention. The authorities are working on a comprehensive migration strategy but details have not yet been announced. The strategy should contain monitoring and protection of rights, such as access to education and training, as well as the monitoring of integration of foreigners. A point-based systems that exist in certain OECD countries and devolution of some of the responsibilities to lower levels of government, that can be more responsive to local labour market needs, could be explored.
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