Poland’s wage growth surprises to the downside once again
Wage growth accelerated to 5.8% yoy in May, offsetting the weak reading recorded a month earlier (5.4%). The figure came in slightly below consensus (6.0%). The pickup in growth largely reflects factors anticipated by the consensus, namely the fading of a high reference base and payoffs in the mining sector. On the other hand, the main source of disappointment was lower-than-anticipated wage growth in manufacturing and construction. Meanwhile, employment growth stabilised at -0.9% yoy.
Average wage in the enterprise sector increased by 5.8% yoy in May, up from 5.4% in April. This outcome came in slightly below both the consensus and our forecast (both at 6.0%). The acceleration in wage growth in May was driven by one-off factors. Most notably, the fading of the high base effect from April 2025 was key, as it had pushed wage growth to its lowest level in five years. A secondary, though less significant factor was the mining sector and specifically, payoffs in one of mining companies, which we estimate contributed around 0.2 percentage points to the wage growth. On the other hand, the positive contribution of these factors was offset by a pronounced slowdown in wage growth in manufacturing and construction. These sectors subtracted around 0.3 percentage points (in non-seasonally adjusted terms) from the May reading, fully accounting for the scale of the downside surprise relative to the consensus forecast.
Today’s reading does not in any way invalidate our forecast for this year (5.5%). Wage growth should continue to gradually decelerate amid persistently weak labour demand and a favourable inflation outlook. The easing of cost pressures stemming from the Middle East conflict provides additional support for this scenario.
Contribution of individual sectors to the pickup in yoy SA wage growth in March (pp)
Source: Statistics Poland, Pekao Research
Average employment in the enterprise sector declined by 0.9% yoy in May, unchanged from April. This was in line with both consensus and our forecast. In monthly terms, the number of jobs fell by 9 thousand. At the same time, there is little new to add regarding employment - it remains under pressure from weak labour demand, implying a rather subdued outlook for the current year. We expect the pace of employment decline to remain broadly stable in the coming months.
Change in employment since January of each year (thousand jobs)
Source: Statistics Poland, Pekao Research
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