Firms cut jobs and wages as global crisis hits

Employment in these firms grew by 2.3 percent y/y in December, rising to 5.36 million people. The number dropped by 0.6 percent m/m, however.

Employment and wage growth will continue to slow throughout this year due to the global economic slowdown, macroeconomic experts agree. The year 2009 may also see a 13 percent rise in unemployment. Employment offices nationwide expect as many as 700,000 people could lose their jobs this year, according to daily newspaper Polska.

The redundancies reported in 2008 affected 57,000 in Poland, Rzeczpospolita reported. The Podkarpacie voivodship has been most affected; the cuts were 20 times larger last year than in 2007, amounting to a total of 3,113 jobs lost.

Export-dependent sectors have been especially hard-hit, including the furniture, clothing and automotive sectors. Construction will also continue to suffer, experts predict.

With decreasing pressure for wage increases, inflation may drop to about two percent in Q2 – as compared with 3.3 in December – and interest rates will also decrease, according to Michał Karewicz, a currency and bond analyst at Citigroup in Warsaw.

Konrad Kiedrzyński