May’s wage data for Poland’s enterprise sector confirm a further slowdown in pay growth. Average wages increased by 5.8% year on year, compared with market expectations of 6.0%. This was the second-lowest reading in two years, with only April recording a weaker result, when wage growth stood at 5.4%.
Following the very strong increases in remuneration seen in 2024, when wage growth was at its highest level in more than two decades, the labour market is gradually returning to a more balanced pace of expansion. The average gross monthly wage in companies employing at least 10 people reached PLN 9,173.24 in May.
The latest data consistently confirm that wage pressure in the economy is easing. This is important from the perspective of monetary policy, as strong pay growth has been one of the factors sustaining inflation in the services sector in recent years.
At present, the Monetary Policy Council identifies potential energy-price shocks and the possibility of further price increases spreading across other parts of the economy as the main sources of inflation risk.
Although communication from the President of the National Bank of Poland and other members of the Monetary Policy Council suggests that interest rates are likely to remain stable in the coming quarters, it is worth noting the latest decisions by central banks in the region.
In June, both the European Central Bank and the Czech National Bank decided to raise interest rates by 25 basis points.
The data suggest that Poland’s labour market is moving away from the exceptional wage pressure seen in 2024. Slower pay growth may ease inflation concerns over time, but the outlook for interest rates will still depend on the path of energy prices, broader price developments and monetary policy decisions across Europe.
