In preparation for the upcoming October 15 elections, Poland’s Prime Minister has announced a substantial increase of nearly 18% in the minimum wage, set to take effect in January. This move comes as the cost of living becomes a top concern among voters.
The ruling nationalist Law and Justice (PiS) party is striving to achieve a historic third term in office, and they are emphasizing the positive impact of their generous social benefits and significant minimum wage hikes on the lives of the electorate.
Starting in January, the minimum wage will see a rise to 4,242 zlotys ($980) per month, with another increase to 4,300 zlotys scheduled for July. This brings the total wage increase since PiS took office in 2015 to an impressive 146%. Additionally, the party has announced a noteworthy 60% increase in child benefit payments, set to be implemented in January.
Prime Minister Mateusz Morawiecki declared during a news conference, “Today, at the Council of Ministers, we adopted the minimum hourly rate, which in 2024 will be 27.70 zlotys,” highlighting the substantial change from previous norms.
The Civic Platform (PO), Poland’s largest opposition party and a key player in the Civic Coalition (KO) grouping, is seeking to challenge PiS’s dominance. KO spokesperson Jan Grabiec criticized the Prime Minister’s statements, arguing that they do not accurately represent the financial realities faced by the Polish people, who have seen their purchasing power eroded by double-digit inflation.
In August, inflation in Poland was recorded at 10.1%, a decrease from its peak at 18.4% in February. Meanwhile, wages in the corporate sector, which have been on a double-digit growth trajectory since February 2022, increased by 10.4% in July.
Piotr Bielski, the head of economic analysis at Santander Bank Polska, pointed out that the minimum wage hike is one of the factors contributing to continued double-digit wage growth. This, in turn, is expected to exert pressure on prices and stimulate demand while potentially creating significant labor cost challenges for companies.
