Poland’s Ageing Population and the Role of Foreign Workers 
Poland’s population is aging rapidly, and to maintain a balanced labour market and pension system, over 2.6 million additional foreign workers will be needed by 2033, according to economist Grzegorz Siemionczyk from money.pl. Currently, there are just under 1.2 million foreign workers in Poland, but is mass immigration the solution to these economic challenges? This article examines both sides of the debate.
The Impact of Foreign Workers and a Slowing Growth Rate
As of mid-2024, foreigners made up almost 7% of the Polish workforce, compared to just under 4% five years ago. However, the growth rate of foreign workers is slowing, with only a 6% increase in 2024. This is the smallest increase since at least 2014, excluding 2020 when migration was hindered by the pandemic. The Social Insurance Institution (ZUS) highlights the need for a significant increase in immigration to maintain balance in the labour market and pension system.
Poland’s aging population, driven by declining birth rates and rising life expectancy, is putting pressure on the pension system. The demographic dependency ratio, which measures the ratio of post-working-age people to working-age people, is currently 39.8%. This means that for every 100 working-age people, there are nearly 40 people of post-working age. This ratio is expected to rise to 45% by 2033, according to the Ministry of Finance. As the number of pension recipients grows and the number of contributors shrinks, the deficit in the Social Insurance Fund is likely to increase, placing a greater tax burden on workers.
Mass Immigration as a Solution: Limitations and Challenges
To maintain the current demographic dependency ratio of 40%, ZUS estimates that Poland would need to attract 2.65 million additional foreign workers by 2033, requiring an annual increase of nearly 270,000 people. Even to slow the rise of the dependency ratio to 42.5% by 2033, Poland would need to attract 1.25 million foreign workers, or 125,000 annually. In 2022, ZUS registered 188,000 foreign workers, largely due to the influx of Ukrainian refugees, but 2023 saw a much lower increase of only 65,000. ZUS concludes that while immigration can improve the demographic situation, it will not fully offset the negative trends caused by an aging population.
Mass immigration levels also raise concerns about economic dependency. Policies that increase labour-force participation, combined with selective migration focused on education and integration, could improve economic outcomes. However, mass immigration without sufficient integration risks increasing economic dependency, as large numbers of low-skilled immigrants on low incomes may not fully contribute to the economy. Their tax contributions are low whilst they have a heavy dependence on the state.
Balancing Immigration with Productivity and Economic Growth
There is also debate over whether Poland’s population would accept the influx of immigrants needed to stabilise the demographic dependency ratio. If immigration continues at the necessary pace, by 2033, over 3 million foreigners could be working in Poland. Assuming current employment levels remain steady, nearly one in five workers could be foreign-born. Andrzej Kubisiak, deputy director of the Polish Economic Institute, has pointed out the need for investment in automation and domestic workforce activation to reduce dependence on foreign labour. He also emphasised the importance of combating xenophobia and dispelling myths about the impact of immigration on Polish society.
There are also concerns that relying on low-skilled migrant workers could harm Poland’s economic productivity. Some economists argue that immigration may boost GDP overall but may not lead to improvements in GDP per capita, as has been observed in the UK since 2019. The arrival of two million immigrants in the UK since 2019 has had a negative effect on GDP per capita which remains at 1.5% below its 2019 level. To avoid a decline in living standards, infrastructure, and technological innovation, Poland must ensure that immigrants are skilled enough to replace the highly qualified workforce that has made the country a manufacturing hub in Europe. Failing to attract highly skilled workers could negatively impact long-term productivity and economic growth.
Source: Money.pl
