Poland - A Thriving Economy and its IT Market

Originally published on Aug 23, 2019, updated Feb 4, 2023        

After spending about 8 years of my career in different Polish business and corporate environments, I thought it could be a good time to share some of my observations and insight about the country’s business environment, in particular the IT industry.

In recent years the economy of Poland is showing vital signs of slow but stable development. The first trigger for this developing economy was membership in the European Union. Since Poland became a member of the EU on 1 May 2004, it started determinately getting rid of its Soviet past and cautiously adopting European values as well as benefiting from its donations. According to the data from Eurostat and The World Bank , during the last ten years, the GDP of Poland maintained a positive index and started regaining its highest rates from 2017. As of the year 2018, it reached to 5.14 GDP rate. This growth is predicted to continue for the upcoming years and growth for 2019 is expected to reach over $600 billion for the first time in history.

This also enabled the government to increase expenditure and successfully run many state social and wellbeing programmes, something that the state could not simply afford just a couple of years ago.

Some other factors that enabled such economic growth in the country, to name a few — large domestic markets, supporting small and medium-sized businesses, early and deep economic reforms and prudent policies, EU economic zone, geopolitical stability, and of course, capable workforce. Additionally, the growing stream of skilled immigration from EU and non-EU countries to Poland has boosted the real estate market and settled the demand for more business facilities and urban infrastructure. Today the Polish labour market is attractive, especially to IT professionals. Previously people arrived in Poland mostly as a transit zone to be able to proceed to other wealthier EU states. But now many of them consider staying here as of now, it feels more secure and stable.

Despite the good indicators, the Polish economy and in particular its net exports are highly dependent on the big economy of its neighbours such as Germany, but it seems that the Polish government still wisely manages to benefit from the situation… well, mostly.

According to Wikipedia Poland has seen the largest increase in GDP per capita (more than 100%) both among the former Soviet-bloc countries and compared to the EU-15 (around 45%). It has had uninterrupted economic growth since 1992, even after the 2007 financial crisis. Euronews even called it Poland’s “golden age” of economic growth .

Such growth indicators and trends could not remain unnoticed and soon they started bringing higher results as gradually the country has shaped and positioned itself as a trustworthy business partner to international donors and investors.

Polish Education & The Great Human Potential

Education is one of the well-established institutions in Poland. It provides a well-trained and educated graduates. While the country did not end up in the list of Top Countries for Education in 2019 , (it is actually # 26) this does not refrain it from providing decent training to its students. Poland was among the top 10 countries recommended for quality study in the EU in 2018. With its Bologna system of education, Polish universities, with some of them being old and highly rated in Europe, have no age limits to study. So don’t get surprised if your 40-year-old colleague with two kids still studies at the university. Corruption in the Polish higher education system has been eradicated years ago. It’s recommended to foreign students, especially the ones from post-Soviet countries, not even try this trick with their professors because you risk spending a night at the nearest police department.

Actually, corruption has dramatically decreased in Poland in recent years as a result of building a more transparent, disciplined and democratic society. It’s like another combat of Poles against their evil past that halted the country’s development and progress. Now by no means, Polish people will ever return to that state again. And it’s quite visible on the level of an average person on daily business.

By the way, in this technological age, you can still see many people in Poland reading physical paper books, and I love it. You can notice that being well-educated and intelligent is common and widely respected throughout the country’s non-rural population. Learn more about education in Poland

And it becomes hotter…

Correct, in recent years the summers in Poland became hotter than before, but it’s not about the weather… it’s about the business and economic climate in the country.

While things look promising for the consumer market, industry and agriculture, there is actually another part of the developing Polish economy — the digital economy that still needs development and fixes. Just because the GDP equation focuses mostly on physical goods (manufacturing, production) the digital product and services built and delivered in Poland are not well figured in the country’s output index, except for the workforce they actually employ and tax.

So, what’s the matter with this rapidly developing technology market? There are 2 factors affecting it — IT market trends and local business culture.

Inflating IT Labour Market

Today, the Polish IT production market is really vast, from big names such as Microsoft, Nokia, and Google to outsourcing service giants like EPAM, Luxsoft and rapidly growing local start-ups. Most of these companies are also open to graduates and offer good opportunities through internships and training programmes. It doesn’t matter if you are a beginner or an experienced professional, almost all major cities in the country, including the capital Warsaw can offer you options for your IT career and development. The championship among those cities though belongs to Kraków (Cracow), the 2nd city in Poland. A city of interesting history, magnificent architecture and rich cultural heritage. It truly claims to become the Silicon Valley of Eastern Europe.

With so many options on the menu, the labour market is going crazy with pampering the professionals in the field. As a result, an employee changes their company every 2 years on average. Most often, this change comes not only with almost doubled remuneration (basically offered by local late-stage start-ups) but also with rank or position promotion. For example, a hardly regular specialist who was trying hard to secure his/her minimum output in the previous job is now a senior professional with new career perspectives. By the time a person with four years of experience decides to pursue their next career challenge, they might land quite a good remuneration and a principal position. The situation gets even worse with the current quality of recruitment and talent acquisition by companies. Candidate selection does not really assume robust verification of the candidate’s hard and soft skills but rather is based on filling up current resourcing and staffing needs as quickly as possible. This is especially popular with software houses that in the rigid race with their competitors want to survive the ramp-up period with their Clients stuffing their teams with a workforce with low to average capabilities.

This artificially inflates the market by increasing salary expectations in the meantime decreasing demand for a much more experienced workforce. Indeed, why hire costly professionals if you can replace them with affordable graduates? What about quality output? Well, we still have time to think about how to sell the fish. This approach comes with a sacrifice though. This already kicked out some of the players from the market and some local startups in the first place.

There is another aspect that conditions this kind of employee behaviour. The Labour Code — employees in Poland are protected by the Labour Code as long as a full-time employment contract is concerned (Umowa o Pracy-UoP). This basically obligates the employer to provide ground reasoning, compensation and prior notice upon the employee's dismissal. Yet, for example, an American employee could only dream of getting such protection as well as contract terms.

However, as a result of recent changes in the Polish taxation system, made service contracting (B2B) more appealing to it professionals. First, it comes with a good work-life balance as long as you’re working remotely and does not oblige you to visit the office (if any local branches ever exist in your city). Secondly,? you’re paid gross, with more money in your pocket after paying out your taxes.?

Though B2B contracts are not yet the mainstream in terms of security, stability and flexibility (i.e. example, paid vacations, the period for termination prior notice, etc.) however, more and more employers are opening up space for such negotiations to attract more talent. The recent pandemics and lockdown boosted this trend even further.

If you are a foreigner, it is also worth knowing that more and more recruiters and companies in Poland require knowledge of the Polish language. While this may sound reasonable for native companies, it is a bit weird focus for international companies where business communication is mainly in English. I do speak Polish, but this can artificially create difficulties for many foreign professionals who are new to the country.?

If you have not started yet, find a tutor, or better a Polish friend or colleague who can help you with that ‘not-easy’ language. You’ll soon see the benefits. In fact, you will show more respect to the people and the culture that you are living in. Polish people like it when they see a foreigner speaking their language (which is not the case in quite some countries by the way).

Besides, as they say, the more languages you speak, the more cultures you carry within you.

Years ago the Polish IT market was flooded with international companies. The local management did not have much authority to take decisions with almost zero product ownership. This in its turn influenced the development of corresponding professional disciplines (i.e. product management) in the region negatively.?

Today it’s visibly changing. Through these years Polish counterparts proved their value and competency to drive business and gained more trust from head offices. Polish companies are on the rise and they’re quite successful.

But there is also another side to the phenomenon. The rising quality workforce that the county offers has quickly become highly competitive with its counterparts in other regions. Considering also the difference in pay and lower living costs, some companies already started giving up their workplaces in other regions to the Polish workforce.?

Even the highest salaries of IT professionals in Poland do not pretend to get closer to their counterparts in the west, for most top positions. That’s just another factor making the Polish IT market so attractive and cost-effective both from workforce and taxation perspectives.

So, watch out, Poland is right behind your shoulders …

Local Business Culture

With the country being mostly a monoethnic country, apparently, about 80% of the local workforce in IT companies is made up of Poles. Like every culture, Polish culture has its peculiarities and some are being transferred into the business culture too.

During my 8 years, I’ve met with different people and opportunities on my way, and definitely, seen many good behaviours in the Polish business environment. For example, Poles do not like long lectures of the unknown and like to get down to business straight away.?

The usual form of greeting is a firm handshake with direct eye contact. When required, they also follow a stylish and smart dress code and appear well-groomed. In the open workspace (and not only), the people respect each other’s privacy and try not to be intrusive and bothersome to the possible extent.?

Yet, some of the aspects of Polish work culture could be polished (what a word to use here :)) and improved.

The business culture of Poland, in general, was considered to be quite formal and hierarchical. Hofstede’s power distance index (PDI) in Polish organizations is high — 68 which is significantly more than in Western and Scandinavian countries.?

According to Aldona Glińska-Newe?’s report (Nicolaus Copernicus University in Toruń, Poland), this means that the centralisation of decision-making is high, taking much time and with almost no possibility to affect it.?

While this is true for many public and state institutions, the good news is that today, Polish IT companies are shifting this approach by deploying modern management practices — supportive and servant leadership roles with open doors policy, etc. Such changes are typically conditioned by overseas business partnerships and client policies. It requires developing a muscle and the best practices are not fully established yet.

Typical work hours are from 8 am to 4 pm. Many start even at 6 am. Projects that assume collaboration with teams across different time zones can face hard times with keeping people engaged. Most Poles would not stay “a bit longer” (even if overtime is paid) to overlap with the availability of their overseas peers and this causes issues. Well, nobody likes staying longer at the office than expected but we all know exceptions occur for some reasons.

When you commit to such a project you should definitely expect things like that. For example, people might even leave the meeting (and sometimes even without prior notice) when their work time is up but the meeting is still running. It is not perceived well by overseas workaholic culture but rather viewed as disrespect or misconduct.

We all strive to reach the life-work balance, don’t we? But at the same time, we try to keep professional and find the golden middle whenever possible. Just demonstrating some engagement and empathy sometimes would really do. Unfortunately, many Poles do not demonstrate much empathy in a work environment, they mostly don't like cultivating relations and close ties.

If you happen to be contracting a Polish entrepreneur or business, you should not count on getting a more attractive offer as a loyal customer or more room for further negotiations. Generation of leads, customer attraction and retention still require dramatic improvements in the Polish service sector. By the way, don’t get surprised when you won't receive a follow-up call or message to check up on your issues or queries.

Poles do not bother with trifles and they always seem to be not in a hurry. Yet, one thing is for sure - you will get the required minimum from your service, not more and not less. Phrases like “going the extra mile” or “leaving your comfort zone” are not much about the Polish work culture.

There are no rules with exceptions, and Poland is a country of exceptions too. At the very same time, I had the honour and pleasure to meet and work with Polish professionals that were exceptional talents, and geeks of their area and demonstrated high working culture and utmost performance. These are mostly people who worked or lived abroad and sensed the western business culture, so they can easily fit and adapt to such an environment.?

Do not expect much proactivity at work. Polish people are rather silent performers and the truth is that most of them don’t demonstrate “a great passion” and dedication to their work like they do in the West.

You should also know that Polish start-ups are living their golden age now. This country keeps revealing its creative and inventive mind. The current worldwide trend among the young also became viral in Poland where more and more young professionals start their own businesses and develop it further instead of spending their careers and energy with boring and bureaucratic corporations — something that we, the Generation-X-ers would still want to have if ever given a second chance.

Into the bright future

I do believe in the bright future of Poland. With young and energetic talents, affordable and good education, in the arms of a thriving economy and in a protected and multi-optional labour market, Polish IT professionals have all the necessary preconditions to develop as professionals and bring their powerful contribution to further growth of the country’s economy.?

The success can become complete if the younger generations can better accommodate themselves to the business environment they’re working in and make that dramatic shift in their business culture as well as in mindset.

But wait, who knows, maybe Poles will make others adopt their work culture instead, and teach others how to achieve a good work-life balance. Never say never, times are changing, and so do our values and ways!:)