Hidden costs and strains for Poland.

AuthorZalewski, Tomasz
PositionCASE STUDY: Polish Migrants to Britain: Pros and Cons - Viewpoint essay

In our era of globalization and free-market dogmatism, emigration is widely deemed a creative force. Labor flows between countries re-equilibrate labor markets in ever-broadening integrated economies such as the European Union.

Poland is a case in point. Since it joined the EU in 2004, up to two million Poles have left the country for jobs in Western Europe. This migration has alleviated Poland's high unemployment, helping to cut the rate from 18 percent to around 15 percent. It has also filled gaps in the recipient nations' labor markets. And the billions of zlotys transferred to Poland by its emigre "guest workers" undoubtedly bolster the Polish economy--in the same way that Mexico benefits from transfers of funds home by Mexican immigrants in the U.S.

The positive consequences are mainly economic and often proved short-lived for Poland. In the longer run, the phenomenon has major disadvantages, especially when viewed in a broader, socio-cultural context. Polish "economic emigrants" tend to be young entrepreneurial types ready to take risks for a better life--the kind of people needed right now in Poland to help build a capitalist economy. Take the Opole region in southern Poland, traditionally one of the nation's richest areas (including under communism), thanks to a strong work ethic and inbred business sense among the people. Now many workers from there have migrated to Germany. They provide the largest flow of repatriated euros of any region in Poland, so Opole is still comparatively well-off. But without these transfers, Opole would have slumped to become one of the nation's poorest regions. Local entrepreneurship has collapsed and the cheap local labor has disappeared. So once-thriving local business has become uncompetitive.

The exodus of young workers also increases the strains on the state-run program of health care and pensions that covers most Poles. The system relies on contributions from workers and from employers to pay for its outlays. But this pay-as-you-go system (as distinct from systems relying on pension funds invested in stocks and bonds) faces a long-term dilemma: as more Poles retire and need to be paid benefits, there are fewer working Poles to pay them. It's a scissors effect: as more Poles live longer, fewer Poles are being born. Today, five working-age people support one pensioner; in 2020, there will be only three people contributing for each pensioner. This budget strain increases as emigrants depart from the...

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