Employment in Poland 2010. Integration and Globalization

Employment in Poland 2010 – integration and globalisation is the sixth edition of the ‘Employment in Poland’ series. Similar to previous editions, we focus on selected processes that infl uence the Polish and European labour markets. This time we focus on European integration, understood as a project meant to increase European social and economic welfare in the increasingly strong network of global ties. We address this report to Polish social and economic policy makers, especially of labour market policy, academic and business economists and researchers in social sciences interested in modernisation in the times of globalisation. In the first part we evaluate the achievements and failures of ten years of Lisbon Strategy implementation in the European Union countries. We discuss sources of the increasing discrepancies between EU countries in achieving employment targets of the Strategy, and the position of Poland in this picture. We analyse long-term and short-term causes of relative successes and failures in individual parts of Europe in the previous decade. We pay particular attention to differences in economic growth rates and related changes in the labour markets between EU27 and USA, showing the reasons for Europe lagging behind the globalising world. We examine the feasibility of Poland converging to the level of EU15 and USA, taking into account the current strategic context, defi ned by Europe 2020 and Poland 2030 documents. In the second part, we concentrate on the mobility of Europeans, especially international migration within the continent and in flows of external immigrants. We evaluate the openness of the individual labour markets in the EU Member States to foreign workers, including the citizens of other Member States. We take a closer look at integration of the European labour market, and the direction of changes in internal migration, cross border commuting, and the economic effects of the increased openness of Europe to immigrants from third countries. We also analyse the phenomenon of return migration which is especially important from a Polish point of view. We discuss its potential as a tool for levelling development differences within the EU. Finally, we assess the impact of EU regulations on migration processes, confronting European achievements with the experiences of other developed countries, especially the US. The third part is dedicated to foreign direct investment and its impact on the labour market in Poland and Central Europe. We analyse the most important trends in capital fl ows, focusing especially on FDI determinants in the regional dimension. Due to the export-oriented nature of many investments of multinational corporations in Europe, we also analyse the impact of trade on the labour markets of EU Member States and productivity at the sectoral level. We study how the spatial FDI distribution depends on the expected benefits from trade, and scrutinise general patterns in FDI infl ow and stock to Central European countries. The Polish labour market is analysed taking into account the FDI determinants at the level of voivodeships, using econometric modelling and in-depth interviews with the representatives of enterprises and local officials (Marshal Office) specialising in FDI promotion in Polish voivodeships. We compare the results with evaluation of the effectiveness of individual policy tools used by local governments to increase FDI volume, and a formal analysis of institutional and localisation causes of the uneven distribution of investment in different parts of Central Europe. In the last part of the report, we discuss the local aspects and effects of globalisation. We show the role of global processes in NMS and Poland, and smaller areas – Central European regions and sub-regions. The analysis starts with the presentation of technological, economic and institutional aspects of progressing globalisation and the description of its effect on production and employment structures in the economies of the developed North (including Central Europe) and the developing South. At the same time we analyse how these processes materialise at the local level. We are particularly interested in the inclusion of Poland and the entire region of Central Europe to the European network of economic ties. We isolate a few areas in which globalisation processes adopt adifferent shape, and we analyse the causes of these differences. In the description of effects of globalisation in Poland and foreign countries, we focus on those sectors that are under the particular spell of globalisation. These include: the automotive industry, steel industry, textiles and clothing, and business services that are susceptible to offshoring, including R&D. The report is completed with conclusions and policy recommendations, focusing around the issues of growth policy and regional policy, so those aspects of public policy that are particularly predisposed to tackling the challenges that globalisation poses for the labour market. We do not omit policy instruments concerning the labour market and social security, as they will be key in the choice of development path of Poland – following Northern or Southern Europe. We show that the challenges of globalisation for public policy include both the internal agenda of the Polish government, and Poland’s stance in the European forum – either in favour of European reforms or against them.