2019-02-09

Xiaomist Inc.

The minimum wage in Poland is too high, according to the FOR expert. And it shows hard data

The discussion about the minimum wage in Poland is often crushed by ideological or ethical arguments. Therefore, we hear that entrepreneurs can not afford it, or on the other hand - that Poles should be worthy of earnings. The Civic Development Forum approached the matter somewhat more technically.

FOR's experts complained last year that the issue of the minimum wage was too politicized. It is difficult to discuss this. Only a few months ago, the Minister of Entrepreneurship, Jadwiga Emilewicz, explained that "people must earn a good income", referring in this way to an increase in the minimum salary up to PLN 2250 gross.

Poor company.

Apart from the fact whether this money is enough for a decent life in Poland today (I believe that there are such places on the map of our country), the last FOR analysis ( Index of Employment Flexibility 2019 ) shows that it is worth to slightly inhibit this escalation of demands. Speeding up after 2000 with raising the minimum wage we jumped imperceptibly to 7th place among the EU and OECD countries. Unfortunately, in the ranking, in which we would like to be as low as possible.

Suffice it to say that before us there were states about, to put it mildly, not in the best economic condition like Turkey, Italy, Romania or Cyprus.

The amount of the minimum wage is not a key problem of the Polish labor market, but negatively affects the employment of the weakest employees. A high minimum wage makes it difficult to take up jobs for people whose inexperience, low skills or low wages in the region (real minimum wage is higher in poorer regions of Poland) do not allow to work out enough added value to make their employment profitable - the report reads.

Biedronia ideas.

And in the near future it may be even more interesting. Now a new player on the political scene joined the auction - Robert Biedroń's Spring. And it broke even the most demanding demands of the trade unionists, because for good morning it threw 2.7 thousand. zł.

Taking inflation into account, it is an increase of 17%, while the European Commission forecasts a 5% increase in wages and 3% labor productivity. Increases in the minimum wage rarely have a dramatic impact on the labor market, because they mainly affect employees with wages similar to the minimum wage. Of these, part of them actually receive increases, but at the same time, some are pushed into contracts for a specific work, self-employment, straight into the shadow economy or stop working at all - explains in the meantime in a conversation with Spider's Web Rafał Trzeciakowski from FOR.

In his opinion, such experiments will be particularly dangerous in the context of people whose situation on the labor market is inherently the weakest - foreigners (excluding expatriates) and young people.

In the European Union, approximately 1/3 of the variation in employment rates of people aged 20-29 can be explained by differences in the minimum wage - says Trzeciakowski.

And this is all very disturbing data in the context of the increasingly announced recession.

* The graphs come from "FOR Communiqué 3/2019: Employment Flexibility Index 2019 - Poland in the tail"



The minimum wage in Poland is too high, according to the FOR expert. And it shows hard data

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