More and more frequent information about shortening the working time or limiting production due to the shortage of raw materials may contribute to the dismissal of employees – says the latest analysis of the Investment and Economic Cycles (BIEC).
Record low unemployment in Poland
Even though the unemployment rate is record low, both registered (4.9%) and LFS unemployment (2.6% in 2018 Q2), the economy is clearly slowing down and there are concerns about possible changes in the market.
The Labour Market Index (WRP) provided by BIEC, informing in advance about future changes in the unemployment rate in August, has not changed in relation to the value from a month ago.
As the authors of the report explain, the labour market usually reacts with a certain delay in relation to changes in production, sales or GDP. Entrepreneurs are neither eager to lay off workers in Poland too quickly when a slowdown comes, nor to hire new workers too quickly in an early recovery. In both cases, the decision is burdened with a considerable degree of uncertainty and generates additional costs related to both layoffs and employment.
Problems for workers in Poland inthe fall
“The increasingly clear symptoms of the economic slowdown are likely to have an impact on the number of employees and the unemployment rate in the near future. The Labour Market Index has been signalling such a possibility for several months redundancies of employees “- says the BIEC analysis.
Since the beginning of the year, the number of job offers has been flowing into poviat labour offices . We observe a similar tendency among advertisements appearing on internet portals.
Also, since the beginning of the year, the number of people deregistering from the census of the unemployed as a result of finding a job has been declining much slower . It is true that the resources of the unemployed registered in PUPs are usually people with the lowest qualifications, who are generally more difficult to find employment. However, given that in summer such people are employed in seasonal work, the slower decline in the outflow from unemployment to employment can be seen as a signal of tightening conditions on the labour market.
The authors of the report point out that from the beginning of the year employers are less and less willing to increase employment in companies . It is true that in August GUS business climate surveys the advantage of companies planning layoffs slightly decreased over companies that intend to employ, but the dominant tendency in recent months has been reduction in employment. There have also been significant changes in the structure of responses to the question about companies’ employment plans.
Moreover, the percentage of large companies planning layoffs clearly increased compared to the previous month, while only a few months ago layoffs were planned rather in smaller companies . In terms of the industry, only companies in the oil processing industry are planning a significant increase in jobs.
The aggregate amount of disbursed unemployment benefits has been slightly increasing for several months . This may indicate that in the structure of the unemployed entitled to receive the allowance, the share of those who are entitled to receive it in full or increased amounts has increased. And this may be a signal that among the newly laid off work there are more and more people with longer work experience – judge BIEC analysts.
Source: BusinessInsider
