Poland’s unemployment rate to be the lowest in EU in 2021

Jobless rate lowest in Poland

According to the European Commission’s forecast, Poland’s unemployment rate will rise to 3.5 per cent this year (compared to 3.2 per cent in 2020) and then gradually decrease again to 3.3 per cent in 2022. Despite the recent drop in employment, which can be attributed to the COVID-19 crisis, Poland is projected to record the lowest jobless rate out of all member states. The average EU unemployment rate has been forecast at 7.6 per cent in 2021 and 7 per cent in 2022. While it seems that Europe’s economy is finally turning the corner after a pandemic-hit year, it has been observed the above-mentioned figures are still higher than pre-crisis.

Cautious economic optimism

As noted by the European Commission, Poland’s fall in GDP (Gross Domestic Product) was “milder” than the EU average in 2020, and the country’s economy is forecast to grow by 4 per cent this year and 5.4 per cent in 2022. By comparison, the EU’s GDP is projected to rise by 4.2 per cent in 2021 and 4.4 per cent next year. However, despite upgrading its previous forecast for the EU’s economic growth, the Commission has expressed cautious optimism:

Economic developments in 2021 and 2022 will be largely determined by how successfully vaccination programmes will tame the pandemic and how quickly governments will lift restrictions. For the EU, the forecast assumes that following a marginal easing of restrictions in the course of the second quarter, progress in vaccinations will enable a more marked easing of restrictions in the second half of the year.

Prices on the rise

On the downside, Poland’s inflation rate is projected to be the second highest (behind Hungary) among all member states - both in 2021 (3.5 per cent) and 2022 (2.9 per cent). As observed in the forecast, the country’s “inflation is forecast to moderate only slightly, as growing energy prices counter the drop in core inflation.”

Source: European Commission