Weekly Briefing, Vol. 52. No. 3 (PL) June 2022
The Ukrainian immigration can help with the Polish demographic crisis
Summary
The Polish Central Statistical Office (GUS) has published the first report on the preliminary results of the National Census. According to it, the youngest inhabitants of Poland are decreasing, as well as the number of people of working age. On the other hand, the share of the population in the post-working age has clearly increased. Over the last 10 years, Poland has gained nearly two million people in the age group of 60-65 years and above.[i] However, Poland’s demographic picture is being changed by immigration from Ukraine. According to research, the country’s population has exceeded 40 million for the first time in history this year due to huge immigration. According to analysts, migration from Ukraine may in the long run positively affect Polish demographic indicators and GDP growth.
Introduction
According to the data presented by the Central Statistical Office on the 31st of March 2021, the population of Poland was over 38 million people. Since the last census, that is since the 31st of March 2011, the population of Poland has decreased by 475.7 thousand people. At the same time there was a decrease in the population of cities – by 657.0 thousand people, while the number of rural residents increased by 181.3 thousand people. Migration of Ukrainians to Poland due to the war, however, influenced the surge in population growth of Poland. For the first time in history, the population of the country exceeded the threshold of 40 million, according to the report prepared by the Centre for Analysis and Research of the Union of Polish Metropolises. According to the report, 41.5 million people currently live in Poland.[ii]
Polish society is aging rapidly
The results of the latest census show a disturbing trend in the demographic situation of Poland. The number of children and youth is decreasing. In the 2021 census, the share of the population aged 0-17 was 18.4 percent, compared to 18.7 percent in the 2011 census. Compared to 2011, both the size (by over 2.2 million people) and percentage (by 3 percent) of the working-age population decreased. On the other hand, the share of the population in the post-working age group increased significantly – from 16.9 to 22.3 percent, i.e., by more than 5 percentage points.[iii] It means that over the decade there were nearly two million more people in the age group of 60-65 and above. The CSO reports in its report that due to changes in economic age groups, the so-called “dependency ratio” has increased. This means that in 2021, for every 100 people of working age, there will be 69 people of non-working age; almost 14 more than in 2011.
– An important change worth emphasizing is the more than doubled percentage of employed in the post-working age group, which is a result of, on the one hand, the aging of the population and, consequently, of the labour resources, but also of changes in the law, which enable the prolongation of professional activity, e.g. by combining professional work with collecting pension benefits – reads the GUS report.
Immigration from Ukraine will improve Polish demographic indicators?
Currently (data from the end of May) in the Polish PESEL database (the number authorizing to receive social, medical and educational benefits) there are 1 million 114 thousand people from Ukraine who came to Poland after the outbreak of war. Since then, almost 3.5 million Ukrainians have crossed the Polish border. More than 1.4 million have already returned to their homeland, and of the 2.1 million who stayed, some have gone to the West.[iv]. However, not all Ukrainians register in the PESEL database, because most of them, according to research, hope to return to the country soon. According to research conducted by the Centre for Analysis and Research of the Union of Polish Metropolises (UMP), taking into account the aggregated geolocation data from cell phones and the PESEL database, 3.2 million Ukrainians were staying in Poland at the beginning of April (before the war, there were already nearly 1.5 million Ukrainians in Poland) [v]. The data show a dramatic increase in the population of the largest Polish cities, e.g. the population of Rzeszow increased by 53 percent, Gdansk by 34 percent, Katowice by 33 percent and Warsaw by 15 percent. According to the UMP data, 266.9 thousand Ukrainians currently live in Warsaw (that’s about 13 percent of the population of the Polish capital).
Bartosz Marczuk, Vice-President of the Polish Development Fund (PFR) and former Deputy Minister of Family, Labour and Social Policy, convinces in an interview with the Polish Press Agency that thanks to refugees Poland will have an additional birth cohort. – These are people at a young age, who have and can have even more children,” says the PFR deputy president. He also adds that refugees can fill gaps in our labor market, where there are about 300 thousand vacancies.[vi] . If the refugees, or a large part of them, stayed, it would be a powerful shot in the arm for Polish demography. Young Ukrainians alone in the PESEL system represent one and a half years of Polish children and youth. But Bartosz Marczuk is cautious about this issue. – It is an opportunity for us in terms of demographics and the labour market. But at the same time we need to remember that strong Ukraine is in our interest as well and draining it of people will not help it – emphasizes Marczuk. [vii]. He stresses, however, that the structure of refugees is good for the Polish labor market. 90 percent of adult refugees are of working age (90 percent are women),” stresses Bartosz Marczuk. Currently, out of 513 thousand Ukrainians of working age with PESEL, 150 thousand found work by the end of May, and in fact maybe even 200 thousand (including black market jobs).[viii]
The young Ukrainians account for 7 percent of Poland’s underage population, the challenge of education
Of the 1.1 million Ukrainian refugees registered in the PESEL system, 47 percent, or more than half a million, are children and adolescents. Currently they already constitute 7% of Poland’s underage population. As experts point out, the biggest challenge will be to include them in the education system.[ix] Currently, less than 200 thousand young Ukrainians study in primary and secondary schools. According to PESEL records, there may be another 160 thousand of them. Among adult refugees, half a million are of working age, 90 percent of which are women. Only 7 percent, or slightly more than 70 thousand newcomers, are over 60 years of age. 50 thousand children – refugees from Ukraine – are up to two years old, and more than 100 thousand are in preschool age. For the Polish education system, according to Bartosz Marczuk, PFR Deputy President, who monitors PESEL data, there should be no major problems in terms of nurseries and kindergartens. On the other hand, 360 thousand school-age children may be a challenge for the Polish education system.
Immigration will increase Polish GDP?
Analysts of the British analytical company Oxford Economics, in turn, believe that the influx of Ukrainians to Poland will fuel the Polish economy, although it will not solve demographic problems. In their opinion, Polish GDP may gain an additional 2-3 percent over the next 30 years (ca. 0.1 percent per year), compared to a scenario in which refugees from Ukraine would not seek shelter from war in Poland. [x]
The company, which provides economic research to more than 2,000 institutional clients worldwide, has prepared two alternative scenarios for the number of Ukrainians who might settle in Poland. Under the baseline scenario, 250,000 Ukrainian refugees will remain in the country. The other two scenarios assume the possibility of an “elevated influx” of 650,000 people and a “high influx” of 1 million refugees who will want to stay in Poland. The results indicate that the long-term impact on the potential of the Polish economy will be significant, increasing Poland’s GDP by 1.7-2.9 percent by 2050.
But analyzing such an impact of refugees on the Polish economy is fraught with difficulties, as Oxford Economics points out. As written, the exact number of Ukrainian refugees currently residing in Poland is uncertain, given that the fate of those continuing further west is not observed. Moreover, the structure of the refugee population is different from what we have witnessed in the past, with women and children under the age of 14 accounting for more than 90 percent of all arrivals. Therefore, according to the firm’s analysts, it is the provision of childcare that will be key to assessing the impact on labor supply.
While recent surveys suggest that while most refugees want to return to Ukraine when the war ends, favorable government policies, cultural and language similarities, a tight labor market and high wage growth increase the chances that a significant number of refugees will stay, the analysts note. Especially since Ukrainians are settling mainly in larger cities. Urban centers such as Warsaw, Krakow, Wroclaw and Gdansk now host more than 2/3 of all those fleeing the war in Ukraine. It’s also where it’s easiest to get a job and unemployment is the lowest. They also have more opportunity to integrate with other Ukrainians living in Poland. On the other hand, restrictions in access to housing and public services may limit this growth of refugees.
According to the company’s experts, even if quite a large number of refugees will stay, it will not be a long-term solution to the demographic problems Poland is facing, i.e. aging of the society and decrease of the labor force participation rate . Nevertheless, economists are of good thoughts. – Even though the inflow of Ukrainian refugees to Poland will translate into considerable fiscal costs in the short term, we believe that in the long run the increased economic potential will more than compensate for it,” comments Oxford Economics economist Mateusz Urban. As he adds, the scale of the impact will critically depend on the number of refugees settling permanently.[xi]
Conclusion
Poland is facing a significant demographic crisis due to both an aging population and a low birth rate. Experts, however, point to the potential of young Ukrainian immigration, which came to Poland as a result of the war in Ukraine and is a chance to improve Poland’s demographic indicators, accelerate economic growth in the future and fill the gap in the labor market. Immigration from Ukraine, however, will not change the basic demographic trends, but may ease them. Much depends on the number of Ukrainian immigrants who will stay in Poland permanently.
[i] The Central Statistical Office https://stat.gov.pl/en/national-census/national-population-and-housing-census-2021/national-population-and-housing-census-2021/national-census-of-population-and-housing-2021-report-on-preliminary-results,4,1.html
[ii] The Union of Polish Metropolises https://metropolie.pl/artykul/raport-miejska-goscinnosc-wielki-wzrost-wyzwania-i-szanse
[iii] The Central Statistical Office https://stat.gov.pl/en/national-census/national-population-and-housing-census-2021/national-population-and-housing-census-2021/national-census-of-population-and-housing-2021-report-on-preliminary-results,4,1.html
[iv] The Money.pl Portal https://www.money.pl/gospodarka/polska-ma-powazny-problem-na-ratunek-moga-przyjsc-obywatele-ukrainy-6771985239710208a.html
[v] The Union of Polish Metropolises https://metropolie.pl/artykul/raport-miejska-goscinnosc-wielki-wzrost-wyzwania-i-szanse
[vi] The Money.pl Portal https://www.money.pl/gospodarka/polska-ma-powazny-problem-na-ratunek-moga-przyjsc-obywatele-ukrainy-6771985239710208a.html
[vii] The Polish Press Agency https://samorzad.pap.pl/kategoria/aktualnosci/raport-ump-w-polsce-mieszka-obecnie-prawie-32-mln-obywateli-ukrainy
[viii]The Gazeta Prawna daily https://www.gazetaprawna.pl/wiadomosci/kraj/artykuly/8420789,ukraincy-w-polsce-demografia-dzieci-i-mlodziez.html
[ix] The Gazeta Prawna daily https://www.gazetaprawna.pl/wiadomosci/kraj/artykuly/8420789,ukraincy-w-polsce-demografia-dzieci-i-mlodziez.html
[x] The 300 economy portal https://300gospodarka.pl/analizy/wplyw-uchodzcow-z-ukrainy-na-polska-gospodarke
[xi] The 300 economy portal https://300gospodarka.pl/analizy/wplyw-uchodzcow-z-ukrainy-na-polska-gospodarke