High operating costs, increasing wages and employee expectations, as well as staff shortages, are just a few of the challenges faced by companies. Despite the continued uncertainty characterizing the labor market, experts predict an upcoming “thaw” and a return to more active recruitments.
“Many indicators suggest that the trends we observed at the turn of the year will herald improvements. Projections for the improvement of the economic situation in Poland are positive, with experts predicting a GDP growth in 2024 to the level of 2.3%. However, with the sustained shortage of staff, the processes of acquiring and retaining employees will continue to demand extra attention and unusual solutions,” comments Marcos Segador Arrebola, Managing Director of Gi Group Holding in Poland.
The previous year has been a period of investment suspension, optimization of costs and processes across many sectors. Companies were more cautious about creating new positions; most recruitments were due to employee rotation. Experts predict that as the economic climate improves, companies will create new jobs, but still cautiously. According to a survey conducted by PFHR and the Lewiatan Confederation, a net employment growth of 8% is projected in 2024 – 35% of companies plan to increase staffing levels, while 27% anticipate a decrease.
Who will get the raises?
2024 started with a change in the minimum wage, which as of January 1 is PLN 4242 gross and will increase again to PLN 4300 in July. On the one hand, this will satisfy the lowest earners and probably reduce rotation within this group of employees. On the other hand, there is a forecast for wage flattening and a risk of higher staff turnover, especially among those who have been earning more than the minimum wage. One response may be the growing popularity of bonus systems.
“Not all employers can afford to give raises to all employees. Therefore, a probable consequence of raising the minimum wage will be wage flattening. Paradoxically, the difference in wages of lower-level employees may be only slightly lower than the salaries of those in higher positions, or with higher qualifications,” comments Anna Wesołowska, Managing Director of Gi Group Poland S.A.
Specialist worker market
Employing people with the right qualifications has become more important than ever. Demand for specialists will increase with the progressive development of new technologies, electromobility, and green energy. The current labor market situation is well reflected in the demand for workers in the automotive industry. According to Gi Group Holding’s “Automotive – Global HR Trends 2024” report, 56% of companies globally report a shortage of candidates with the correct competencies in this sector.
“The development of electromobility reduces, above all, demand for traditional physical labor in the automotive sector. The key competencies for low-level employees are those in the technology realm. For specialists, the knowledge of ecological solutions and principles of sustainable development is necessary. The limited availability of people with these skills may be amplified by high competitiveness from other sectors,” comments Anna Wesołowska, Managing Director of Gi Group Poland S.A.
Employment challenges are not limited to the automotive sector, but affect the whole industrial sector. According to “The Industrial Sector’s Compensation and Trends Report” by Grafton Recruitment, over half of employers declare a lack of skilled staff, and high demand for specialists, not just engineers, will continue in the coming years. Experts note the detrimental influence of insufficient enrollment numbers at technical universities on this matter.
Popularity of flexible forms of employment
In response to challenges related to the cost of maintaining employees, there is a growing interest in external employment, including outsourcing or temporary work. Even though this model is often associated with lower-level employees, it is also popular among specialists.
“Last year, we noted a 13% increase in specialist recruitment in the temporary work format, which could be a response to the sustained economic slowdown, as a result of which companies plan short term. This model can be helpful in case of difficulties in determining the details of the need for additional support or creating a new position. Its temporary nature allows companies to assess whether the envisaged scope of duties and skills meets the real needs of the business. It often happens also that after the contract expires, the employer decides to continue the cooperation by offering permanent employment and development within the organization,” explains Joanna Wanatowicz, Managing Director of Grafton Recruitment.
Temporary work also becomes a good solution for specialists who appreciate flexibility, and thanks to their high or niche qualifications, have no problem finding an interesting project.
Sought after: immigrants from distant directions
Last year, we observed a decreased availability of workers from Ukraine, who are increasingly choosing to work in the West, where they can expect higher wages. Considering the low unemployment rate in Poland, the most important factor for companies is currently the readiness and motivation of candidates to take up employment, hence the growing interest in workers from so-called distant directions.
“Employers are open to recruiting people from outside Europe, including from Colombia, where we have been bringing in workers for some time now. However, visa procedures are a bottleneck. Depending on the direction, waiting for a work permit can take up to 6 weeks, and waiting for a visa even another 5-6 months,” explains Anna Wesołowska, Managing Director at Gi Group Poland S.A.
Time is not the only challenge employment agencies and employers face. The necessity to prepare companies to hire foreigners is important. Language is a major barrier. Additionally, cultural differences not only relate to traditions and habits, but also to European work standards and the ongoing automation of processes.
Artificial intelligence transforms roles
Last year, we all experienced firsthand the undeniable impact of artificial intelligence on future professions. The emergence of tools such as Chat GPT highlighted ongoing automation and made many workers realize the inevitability of changes and the need to take steps towards advancing their qualifications or transitioning to another field. The World Economic Forum predicted that between 2020 and 2025, machines will take over 85 million jobs, while 97 million new, better-suited positions will emerge. So, what is the dynamic of changes shaping up in Poland?
“The scale of automation is, of course, not uniform; it is significantly higher in the case of new investments. In companies that have recently entered this path, there is a visible process of reducing positions related to simple and repetitive tasks in favor of positions requiring hard competencies related to the operation of new technologies. This brings with it the need to raise or change qualifications for workers,” explains Paweł Prociak, Managing Director of Wyser.
A good example of the changes occurring in this area is the logistics sector, which is increasingly reaching for new technologies. The role of artificial intelligence is, among other things, to speed up and optimize work, especially where there are currently the most mistakes. Intelligent systems enable faster creation of transport documents, shipment monitoring, demand forecasting, real-time inventory tracking, and restocking.
Wellbeing more important than ever
A survey conducted by Grafton Recruitment in January showed that a vast majority of employees feel overwhelmed with stress at work. Experts observe that regardless of the tasks performed, employees feel overloaded with duties. This is a result of, among other things, team optimization and the related pressure for efficiency.
“In the current economic reality, not every company can afford to hire new employees, therefore a common practice in recent months has been the disappearance of vacancies – duties were spread among employees. Such actions in the long term lead to a decrease in motivation and burnout; hence, a change in managers’ approach to this issue will be one of the biggest challenges in the coming months,” explains Joanna Wanatowicz, Managing Director of Grafton Recruitment.
A harbinger of change is the increasingly strong voice of Generation Z, which clearly communicates its needs and verifies how an employer’s declarations are implemented in reality. Companies also recognize that meeting the expectations of the youngest employees is key in the context of staff retention.
The role of leaders
The factors that most significantly lower employee turnover are – apart from salary – the opportunity to influence the company’s development, identification with its values and trust in leaders. Hence the organization’s pillars are managers who build lasting relationships with their teams. Gallup research results prove that direct superiors are responsible for as much as 70% of employee engagement.
“Managers are the most important point of contact with teams and simultaneously showcase the employers. If they are proactive, present, and understanding of employees’ needs, they are able to adapt companies to occurring changes and thus effectively counteract rotation. Enhancing their skills, caring for their condition becomes an important element of corporate strategic development,” emphasizes Paweł Prociak, Managing Director of Wyser.
Change is part of everyday life – the pandemic has permanently altered the way we work and communicate, the armed conflict in Ukraine still affects the economy, technological progress revolutionizes job structures. In this context, experts highlight the key role of emerging modern leaders. Change management is not about one-off action, but readiness for constant evolution.
“We must remember that at the center of the ongoing changes is the human being who gives them direction. Results of the survey “Change Management – Manager’s compass 2023”, commissioned by Wyser, showed that although 100% of managers feel ready to implement changes, as many as 59% have difficulty communicating them. Hence the growing role of leadership skills, but above all unorthodox thinking and highly developed emotional intelligence. The true leader knows how to show empathy: actively listen, explain, react and eventually propose solutions adequate to the needs,” concludes Paweł Prociak.
