Polands Unemployment Rate Continues to Plummet

July 2007 9.7%

August 2007 9.1%

As ‘full employment’ is somewhere around 5% there will be full employment in Poland by March next year at that rate . Only Slovakia has an unemployment rate above 10% …anywahere in the EU.

Lithuania fell from 4.7% to 4.1% in the same month.

Hungary and Romania also fell noticeably in that time.

As the unemployment rate in German is also falling it would appear that central Europe is working through its structural labour surplus in double or even in treble quick order.

Anyone keeping an eye on those Ryanair flights ???

I would expect to see many eastern europeans not return after the Christmas holidays. So looking in early January might be the most interesting time. However, you might not see much, as those who are returning permanently will probably be doing so by car.

Be interesting to see if some of the recently opened polish shops and the polish produce in Tesco disappear.

Im not so sure about the idea that the Poles etc are about to leave en masse anytime soon. Granted once the slowdown in the construction sector begins to feed into employment figures many of those employed in construction may move elsewhere but a huge percentage of the immigrant population are employed in other sectors. My experience is that while many are highly educated people who would be welcomed back to Poland with open arms, there are also many without formal qualifications who when working in service jobs in Ireland earn way in excess of what they could hope to earn back in Poland. We shouldnt lose sight of the fact that wages in Poland are still a long way behind what they are for comparable (low-level) work here. With the relatively low cost of travel between the two countries it still makes sense for many to work here while being able to make regular visits home. I know Poles who have brought their whole extended families including elderly parents to Ireland in the past couple of years. Granted if their jobs disappear Id imagine they wouldnt be hanging around but it will be interesting to see who many employers are first to let go. It wouldnt surprise me if in many cases it is the “natives” rather than the newer arrivals.

Yes and this is when the s**t will hit the fan. If the locals are not able to get a job while the “foreigners” are then that is a recipe for trouble in my opinion.

I think it’ll be a slower burn than many expect… According to some emigrant blogs I’ve been following, more poles and lithuanians are on the way…

People aren’t that imaginative at the end of the day and there are now networks here to get people up and running…

It’ll take a couple of months of real reductions in the retail sector to have any effect…

Poland has a huge problem. Their Fertility Rate is down to 1.23. The Polish Government will have its hands full to keep the young people. The Older Generation is becoming the dominant age group because of their past selfish behaviour, will not allow too great a volume of resources to be allocated to keeping the youth. The young will sense this and continue to emigrate. The elderly will occupy all the jobs usually done by young people in a vibrant economy e.g. Bank Tellers in their fifties etc.

In the present EU; the Poles have not a ghost in hell chance of adequately reviving their economies without fierce social upheaval. The little effort that they are currently making is causing friction inside their country and with allot of opposition from secular elements in the EU. NO, the Poles have let their Birth Rate fall too far. Replacement Rate is 2.1. Any young people will leave in their droves; the same is true for the other Baltic States.

Would this be one of the strong fundamentals of the Polish property market? (House are cheap because there is no-one to live in them!). While a reducing population is likely to hit rural areas hardest, it must surely have knock-on effects in urban areas?

Actually there is a housing shortage

Many young people live with the parents longer than we would tend to do .

This impacts on the birth rate as nobody wants to breed when at home with a Catholic Mammy .

The Polish fertility rate was around replacement until 1991 ( at about 2.1) and started a precipitous drop thereafter as the post communist economy eroded many certainties. These kids of the drop are only 16 and not really in the labour market yet. They have nothing to do with unemployment stats .

1989-1999 Fertility here ( buried a bit in a graphic)

2000-2006 Fertility here

The opening of certain labour markets to the more mobile breeding cohort in 2004 had a slight effect . The fertility rate * TFR * was holding steady at c. 1.37 for a good few years and suddenly went below 1.3 as emigration kicked in . Overall fertility dropped 10% because of emigration in recent times.

From the second link .

2007 1.26
2006 1.25
2005 1.39
2004 1.38

2003 1.37
2002 1.37
2001 1.37
2000 1.38

**
However the precipitous drop in the unemployment rate is something else altogether.**

In Ireland TFR went from 3.25 in 1980 ( the popes kids) to 2.5 in 1985 . Emigration started then but the TFR went from 2.5 in 1985 to 2.08 in 1989.

source for that particular assertion here

**Economic uncertainty in the first half of the 1980s had a greater effect than emigration in the second half of the 1980s in Ireland **

So can we please stop discussing fertility as it is a long term variable not a short term variable .

Thank you 2Pack for your incisive dissection of my submission. You are right in what you say, that their rate did not go under the Total Replacement Rate (TFR) of 2.1 until around 1990. However it fell drastically from a rate of 3.2 in 1956, which has resulted in a big and growing bulge in the over 65 Age group. The over 50s would be again much greater and will act as a restraint on any economic expansion.

Your following comment is classic, and you certainly would be accepted with open arms in Leinster House and any other Establishment place in modern Ireland

This thinking has resulted in the current Housing Flux that the PropertyPin is so concerned about. Germany and old aged EU whose TFR is below 1.5 has invested close to €100Bn in Irish Property, increased house prices by up to three and four times, in a period when the CPI only increased by 35%. Why? We have the youngest population of working age in the Western World (this is a fertility thing!).

Our Business Schools or government etc has made no plans on how to handle this money. We are spending it on overpriced houses, gambling, holidays, cars, politicians pay the highest in the EU etc. The small percentage that has made money will have blowing the majority of it away in a couple of years. We are then left with the repayment of the whole lot in the form of up to forty year mortgages. What will happen? Wages will have to increase and it will be Goodbye to our USA companies (came here because our fertility rate was once high), whose stay on this Isle, we have surely shortened!

Yes, our Government has landed us in a right mess, because they too have a log jam in their brains when it comes to protecting us from the eddy, created from a title wave of panic from a rapidly aging EU. The only solution they have for the future is to put more money into Pensions! It just is not the fashion to mention falling birth rates! At the moment, it is not a massive theoretical problem of a chicken and egg situation. Yet we are building up a huge future disaster by constantly taking the wrong option, because the F word is not mentionable!

Our young people have to pay the pensions of: our pay-as-you-go retired Civil Servants; into a fund for future retired Civil servants; the** pensions of Germans **etc which equates roughly to half of their mortgage repayment; and after that they have to take out **their own pensions **under possible future penalty from our enlightened government.

Don’t worry 2Pack, 95% of our population will side with your statement! Saving face is what it is all about for the future.

But no! 2Pack, I shall continue to mention the Fertility Rate when I think it is appropriate, otherwise any economic discussion is useless and leads to utter confusion e.g. the Irish Economy.

It was 2pack who suggested it might be time to stop mentioning the fertility rate.

Jeeny TUG Thanks! How do I edit mu submission.
Apologies to yoganmahew!

What eh? Speak up young man. I nodded off there for a minute doing some work and look what happens. I suppose I can feel like I’ve arrived!

Anyway, demographics are important if you are looking to buy investment property as a long-term bet. The article quoted says a reduction of 4m by 2030. This will not happen overnight, but will be an accelerating trend (more old people die as they get older, strangely enough), until it hits the top of the bell curve. Assuming no other factors influence it (inward migration, porn movies on state television on Friday nights, Catholic fundamentalists).

The point is, IMO, demographic trends are visible now in terms of risk analysis. Reversals/alterations to the trend are known unknowns!

But ours fell from 3.2 in 1980 to 2.1 in 1989 . We contracted faster …but we stopped contracting in 1995 and then at a higher rate than Poland has now.

But unlike Poland we have some smidge of a warchest in the form of a national pension fund that may not be tapped until 2025.

As for the civil service it is a mess that can only begin to be sorted by a long term pay freeze and/or setting their wages at a % of the long term average …whether that goes up or down .

Well it has a bearing if you will pardon the pun !

But you started it when you brought fertility into a post on unemployment :slight_smile: . My point is that I feel economic uncertainty and insecurity has a greater bearing on fertility rates than you may yet have conceded.

The old East Germany had a TFR of 0.80 in 1994 for example.