In Q1 2024, nearly 16% of applications for establishing a sole proprietorship were submitted to the CEIDG registry by individuals with citizenship other than Polish. In the same period last year, this percentage was 14.5%. The majority of these applications were from Ukrainians. From January to March this year, there were 9,000 applications, compared to nearly 8,000 a year earlier. Belarusians and Germans follow in this ranking. According to experts, the situation in our labor market will influence the number of such businesses opened by foreigners. However, opinions are divided on whether the number of such entrepreneurs will continue to increase in Poland.
Data from the Ministry of Development and Technology shows that over 75,000 applications for establishing a sole proprietorship were submitted to the CEIDG registry in Q1 2024 (over 80,000 a year earlier). The vast majority of these were submitted by Polish citizens, with nearly 64,000 applications from January to March this year (previously just under 67,000). Thus, in the first three months of this year, nearly 12,000 applicants were individuals with citizenship of another country (almost 16% of the total). A year earlier, it was also nearly 12,000 (close to 15%). This group also includes entrepreneurs with dual citizenship, such as Polish and German or Polish and Ukrainian.
“We see that the overall number of applications to the CEIDG registry is lower year-on-year, but the share of those submitted by foreigners has increased. This may be related to a desire to leave the gray economy. Additionally, significant increases in the minimum wage may have led employers to seek cost reductions, suggesting employees or candidates establish sole proprietorships. It would be useful to ask whether foreigners actually want to do this. However, we won’t find out,” comments Marek Zuber, an economist at the WSB Academy.
Jeremi Mordasewicz, an advisor to the board of the Lewiatan Confederation, notes that year-on-year changes are minimal. Moreover, foreigners opening sole proprietorships in Poland benefits our economy, as it helps meet the demand for both physical and intellectual services. The expert emphasizes that from this data, we do not know whether newcomers focus on operating alone or plan to hire others in the future. The latter option is less popular but does occur.
“In my opinion, the scale of this phenomenon is not very large, especially considering the recent influx of Ukrainians into our country. From a potential income perspective, it’s hard to say without additional data. We don’t know what they do here, what taxes they pay, etc. However, our economy certainly benefits. My observations also indicate that foreigners are not very keen on establishing businesses here, often due to fears of bureaucracy and various controls. They prefer to remain in the gray economy as much as possible,” says Łukasz Goszczyński, a legal advisor and expert at the GKPG law firm.
Among foreigners who submitted applications to the CEIDG, the majority were Ukrainians – 9,000 (nearly 8,000 a year earlier). According to Jeremi Mordasewicz, these figures are not surprising. For years, Ukrainians have made up the majority of immigrants. Therefore, it’s understandable that they account for the most sole proprietorships among newcomers. The Lewiatan Confederation expert believes it would be interesting to gather information on the structure of these businesses, such as whether employers forced the establishment of such entities.
“In the first quarter of this year, little has changed across our eastern border compared to the beginning of 2023. I mean that there was no situation causing mass returns to Ukraine. Instead, more Ukrainians are seeking work in other parts of Europe, particularly in Germany. Some Ukrainians are certainly trying to start businesses here, sometimes connected to their homeland. However, previously mentioned factors influence the year-on-year increase,” asserts Marek Zuber.
Following Ukrainians in the ranking are Belarusians – over 1,000 (over 2,000 a year earlier) and Germans – 130 (103). Next are those with dual citizenship – Polish and German – 116 (94). Then come Russians – 101 (146), Bulgarians – 89 (96), Romanians – 78 (107), and those with Polish and Ukrainian citizenship – 65 (71). Next are Italians – 64 (62), and those with Polish and Belarusian citizenship – 62 (77).
“Interest in establishing sole proprietorships among Belarusians depends, among other things, on the relations between our countries. In recent years, there has not been much sympathy, mainly due to differing views on Lukashenko’s regime. Additionally, there are tensions between Poles and Belarusians, further complicated by the animosity between Ukrainians and Belarusians. It cannot be ruled out that it is more difficult to leave Belarus, so fewer people are willing to open businesses abroad,” analyzes Jeremi Mordasewicz.
Marek Zuber, on the other hand, draws attention to the situation in Germany, as reported by local media. There are many reports of economic problems and companies seeking savings. One option is conducting business in Poland. Although labor costs and energy prices are also rising here, it is still cheaper than across the Oder River. This is evident in the offered wages. The expert emphasizes that such relocations may interest not only one-person companies. Savings are also needed in enterprises employing many workers.
“As for Russians, Bulgarians, Romanians, Italians, or those with dual citizenship, the reason for establishing businesses here may be that they partially function here, i.e., they live, have families, etc. I know cases where these individuals register businesses here only to provide remote services from Poland to their home countries because it’s more convenient or because they live here but still want to maintain ties with their country,” adds Łukasz Goszczyński.
According to Jeremi Mordasewicz, the situation in our labor market will primarily influence the number of sole proprietorships opened by foreigners. It is relatively easy to find work here today, with very low unemployment. At the same time, the demographic trend will not change for several decades. More people will leave the labor market than enter it. The expert notes that employers are trying to retain employees by offering employment contracts. The second half of the year should also be better for the economy, so companies should be more willing to hire.
“We will likely see an increase in the number of sole proprietorships created by foreigners. I wouldn’t single out any specific industries, but this scenario may be particularly visible in trade and small services. However, I think that in the coming years, we will mostly see the migration of individuals coming for regular jobs, who will leave after some time. It’s also important what the Polish government will do regarding entrepreneurship, i.e., whether regulations facilitating business operations will be enacted. We don’t know this yet; we have been waiting for specifics for several months. This could also impact the number of companies established by foreigners,” analyzes Zuber.
“I believe that in the coming quarters of this year, the number may be similar to the current one or even slightly lower. Everything depends on the situation in Ukraine. If the war continues to deepen, it may result in more new entrepreneurs here. However, looking at it from another perspective, I think even such a scenario is unlikely. The initial wave of people settling here was quite large, and it will be hard to surpass that. Additionally, some of the people already here probably want to return to Ukraine or move further west in Europe. Therefore, not much may change in this regard,” concludes the expert from the GKPG law firm.
