Will foreign workers revive the automotive industry?

What's happening in the automotive industry?

The automotive industry is a vital part of the global and Polish economy — it employs thousands of people, turns over billions of zlotys, and influences many other sectors. It's no surprise that economic trend experts watch it very closely. The Gremi Personal Analytics Centre also monitors the moods and trends prevailing in the automotive sector. That's why, at the 13th MotoIdea Conference, where most of the key players in the automotive industry gathered, we conducted a survey of companies related to this field. A total of 43 representatives of the sector participated. The results were extremely interesting and lead to many fascinating conclusions — and not just about the automotive industry itself…

Challenges and problems

Let's start with the problems and challenges that the majority of surveyed companies face. According to the report, the most serious pain points in the automotive industry include: the effects of the global recession (cited by 35% of respondents), a shortage of workers (26%), an unstable political situation (23% of companies), the loss of key markets (9%), and high inflation (7%). Are companies still feeling the effects of the war and Russian aggression against Ukraine? It turns out that 35% answered this question affirmatively, pointing to specific obstacles: problems with the supply of components and raw materials that caused production stoppages, and the lack of regular deliveries of industrial packaging needed for production. Added to this are rising energy and gas prices, which have led to higher operating costs. Among the significant problems noted were also those related to more expensive servicing and spare parts.

Growth despite obstacles

Do the above-mentioned problems translate into employment challenges? Not necessarily. Looking at staff turnover in such companies, it turns out to be "relatively low." Almost one in three companies indicated that on average it is 5–10%. Significant staff shortages are felt by 33% of companies, and major shortages by 10%. Respondents also indicated that 40% of companies plan to hire new employees within the next 3 months. According to Damian Guzman, Deputy General Director of Gremi Personal, this figure shows that the automotive industry is growing and developing despite economic and geopolitical challenges. "It also means that Poland is an attractive destination for labour migration," says Damian Guzman, while drawing attention to the fact that some sectors of the economy simply could not manage without migrant labour — for example, construction and industrial processing. "We see the growing role of foreign workers in almost all areas of the economy," Guzman emphasises. These words are confirmed by the findings of the Gremi Personal Analytics Centre. Among the surveyed companies, there were virtually none that employ no foreign workers at all. In 46% of companies, foreign nationals account for as much as 10% of the workforce. A significant share — 86% of respondents — employs Ukrainians.

Change is necessary

What does all this mean for the Polish labour market? According to Damian Guzman, without a change in migration policy for the unskilled labour market, Poland will soon face a "harsh reality" stemming from the fact that the migration potential of neighbouring countries (Ukraine, Moldova, Belarus) is simply running out. While Ukrainians remain the largest group of foreigners in ZUS records, their share is declining. Whereas in 2019 it reached 75%, by the end of July of the current year it had fallen to 68.2%. Meanwhile, the share of migrants from other countries is growing, including Georgians, Indians and Filipinos. Better financial conditions, among other factors, are causing many Ukrainians to move to Germany. According to Eurostat data, at the end of June 2023, approximately 1.1 million Ukrainian citizens were registered in Germany, while in Poland there were nearly 975,000. This means that since August 2022, the number of registered refugees in Poland has fallen by more than 350,000 people, while in Germany it has risen by more than 410,000 in the same period.

"Expanding the market to workers from Asia is a necessity, of course with caution given national security considerations," states Guzman. The question of whether foreign workers will revive the automotive industry will therefore be answered by the near future.

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