Poland is investing in the expansion of its military capabilities on an unprecedented scale. However, the speed at which these ambitious plans can be executed may be hindered by serious challenges in the labor market. According to the “CE Economic Outlook” report by consulting firm Deloitte, the defense sector will require approximately 70,000 additional soldiers, 90,000 specialists in the arms industry, and 77,000 workers across supply chains.
This presents a significant challenge, especially since more than 40% of companies in Poland are already struggling to fill vacancies. Moreover, within the next decade, the number of people of working age is projected to decline by another 800,000. Without additional efforts to boost labor supply, the defense sector’s expansion could drive wage pressures, reduce the competitiveness of Polish firms, and slow the growth of tax revenues.
250,000 Workers Needed by 2035
Current employment levels in Poland’s defense industry fall far short of what’s needed to implement modernization plans. By 2035, the sector — including the armed forces and their technical support — will need approximately 250,000 new workers. This growth stems not only from increased orders and a larger army but also from Poland’s expanding role as a defense supplier. This is a dramatic shift, particularly as the population aged 18–44 continues to decline. Maintaining balance will require not only growing the defense workforce, but also compensating for labor shortages in other industries. Activating students, retirees, and people with disabilities could play a key role in this process.
Strategic Labor Policy and Education Reform
At the same time, national policy should support the movement of workers into more productive sectors, thereby improving resource efficiency and increasing tax revenues needed to finance defense. Education and training systems must also adapt to better meet the needs of the defense sector and the Polish Armed Forces.
Strengthening military capabilities requires more than just buying advanced weapons and building domestic production capacity. It also demands a full support ecosystem: trained personnel, infrastructure, industrial and service competencies. Without people, a modern and effective army cannot be built. “In a situation where unemployment is at a record low of 2.8%, and the working-age population is steadily declining, ensuring an adequate number of specialists becomes one of the most pressing challenges for the entire sector,” said Mariusz Ustyjańczuk, Partner and Defense Sector Leader at Deloitte Central Europe.
Long-Term Defense Financing
Defense investments may not directly stimulate economic growth, but they serve as a form of strategic insurance. Their purpose is to prevent conflicts, which entail far higher costs. According to the European Bank for Reconstruction and Development, countries that experience war on their own territory see an average GDP per capita that is 7 percentage points lower than comparable peaceful nations. From this perspective, defense spending is not a burden, but a prerequisite for economic stability and the avoidance of long-term socio-economic losses.
Given the need to increase defense spending permanently, Poland must find more sustainable financing sources than expanding public debt, which is approaching the constitutional limit of 60% of GDP. The long-term solution lies in promoting economic growth and improving Poland’s fiscal position — leading to a larger GDP and higher tax revenues.
Defense investments require not only significant financial outlays but also resource reallocation. In the context of an aging society and one of the lowest unemployment rates in the EU, both finding funding and recruiting skilled workers are major hurdles. “This is why the country’s security strategy must now be tightly linked to labor market policies and a long-term development agenda,” noted Dr. Aleksander Łaszek, Leader of the Economic Analysis Team at Deloitte.
Productivity Is the Key
Poland’s defense industry growth must go hand in hand with productivity improvements to maximize available resources. The key to effective transformation is moving away from labor-intensive production toward standardized industrial processes. This will require investments in automation on the business side and a smart, long-term procurement strategy from the military.
Efficiency can be improved by ensuring predictable, long-term order pipelines, maintaining the complementarity of different weapon systems, and involving the private sector through public-private partnerships.
The urgency to boost productivity is growing due to real security threats. Many Central European countries significantly increased their defense spending after Russia’s invasion of Ukraine. Data reveals a clear trend: the closer a country is to Moscow, the higher its defense expenditure as a percentage of GDP. Poland, for instance, now spends over 4% of GDP on defense, while Baltic states such as Estonia, Latvia, and Lithuania all exceed the 2.5–3% mark.
