Despite year-over-year growth in employment in the shared services sector, the demand for office space remains steady. However, SSC/BPO/R&D centers continue to lease the most office space in Krakow and Wroclaw. Warsaw also remains a constant target for corporations.
According to the latest ABSL report, by the end of the first quarter of 2023, employment in the shared services sector in Warsaw, Krakow, and Wroclaw totalled more than 250,000 people, with a further increase of 20,000 expected this year. In comparison, the sector employs over 435,000 people nationwide, accounting for 6.7% of all employment in the corporate sector. The fastest growth in the last five years has been observed in Warsaw, which is almost on par with Krakow, the largest employer in the shared services sector. This year, both cities should exceed 100,000 employees in this sector.
KiBS Hunting for Talent
The largest cities in the country – Warsaw, Krakow, and Wroclaw – are vying for centers providing more complex and advanced services, known as KIBS. As Knowledge Intensive Business Services, they are defined as business operations and services largely based on professional, advanced technological or sector-specific knowledge. “Due to the large pool of potential candidates and the increasing cooperation between business and academia, the biggest cities in Poland are well-prepared to undertake and manage the most knowledge-intensive processes. International corporations looking for experienced and well-educated talents first check the possibility of locating their centers in the strongest academic centres,” says Anna Szymańska, Director of Office Space at Newmark Poland.
In addition to internal competition, Polish cities vying for shared service centres mainly compete with Romania, Bulgaria, Czech Republic, Spain, and India.
Warsaw, of course, leads among academic cities. At public and private universities, more than 250,000 people study here. The next city standing out in this regard is Krakow, where around 130,000 people study at 18 universities. “A major advantage of the capital city of Lesser Poland is its professional staff, combining linguistic competences with knowledge from other areas, such as IT, engineering, and human resources management,” says Katarzyna Wysocka, Director of the Department for Entrepreneurship and Innovation at the Krakow City Hall. – Krakow’s universities cooperate with businesses, which has resulted in the creation of a pioneering study – Global Business Services (GBS) at the University of Economics. The program was created in close cooperation between business and academic organizations. Among the partners were ABSL and 28 leading entities from the industry, as well as local startups and the Krakow City Hall. This academic year, as many as 497 candidates applied to study at GBS, meaning five people per place – explains Katarzyna Wysocka.
Among Polish academic cities, Wroclaw also shines. Over 106,000 people study in the capital of Lower Silesia. An example of cooperation between universities and industry is the IoT Laboratory – opened in the IT department of WSB Merito, a joint project of the university and the American company that designs and develops software – GlobalLogic.
The Agency for the Development of the Lower Silesian Agglomeration also contributes to the creation of new academic courses relevant for business. “Together with the ABSL association, we are working on creating a bachelor’s study program in the field of SSC at the University of Economics. We actively promote cooperation between education and business, supporting the establishment of the first Polish branch of the British university – Coventry University in Wroclaw,” says Weronika Mystek, senior specialist in the Investor Support Department, Invest in Wroclaw / ARAW.
Krakow and Wroclaw are the Top Choices for SSC/BPO Tenants
Analysts at Newmark Poland have been observing for many years how the market for modern office space is growing thanks to shared service centres. “Considering the level of employment in the region, we estimate that companies in this sector occupy over 2 million square meters of modern office space in Warsaw, Krakow and Wroclaw, which is more than a quarter of the total office resources rented in these cities. Percentage-wise, the shared services sector occupies the most office space in regional cities – we estimate that this is even 55% of the rented office space in Krakow and about 45% in Wroclaw – explains Agnieszka Giermakowska, Director of Market Research and Consulting, ESG leader, Newmark
New Players in New Offices
The largest Polish cities – Warsaw, Krakow, and Wroclaw – are attracting new shared service centers (SSCs), with companies like BASF, Allegro, airSlate, NatWest, L&T Technology Services Limited, SoftServe, Teleperformance Poland, Novocure Poland, Imperial Brands Services Poland, Fresenius Kabi, and Rockwool establishing new facilities in recent years. The shared services sector in these cities is expected to grow even further in 2024, with an estimated 50-70 new centers opening their doors.
The growth of SSCs in Poland is driven by several factors, including the country’s strong talent pool, cost-competitiveness, and strategic location in Central Europe. Polish cities are also increasingly attractive for international companies due to their growing reputation for innovation and technology.
