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Warsaw packed



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Published Date: 05 October 2008
A SMALL boy clothed in a frayed woollen jumper looks out of a rickety red tram as it draws to a halt on Jana Pawla II Street in central Warsaw.
With his face squashed up against the window during the busy morning commute, he looks down forlornly at the black Mercedes that stops alongside. As soon as the lights change, the chauffeur-driven Mercedes speeds away, weaving in and out of the mo
rning traffic as it carries two of Poland's growing band of wealthy executives to work.

Such examples of the contrast between new money and reminders of Poland's hard-up communist past are becoming increasingly common in Warsaw as, four years after the country entered the European Union, signs of the wealth that Poles hoped EU membership would generate become more and more evident.

Next to depressing, grey Soviet-era high rises sit the products of its new, liberalised market ways: impressive glass-fronted hotels and office blocks, including a modern Coliseum-like office and shopping complex designed by UK architect Sir Norman Foster.

But British architecture is not the only sign of Poland's long-standing relationship with the UK, which is still described by Polish dignitaries as its "old ally and friend". In almost every corner of Warsaw, from the banks to the bakeries, polished English accents sing out. Despite ongoing laments from the right-wing of the British press about how Polish immigrants are flooding the UK job market, and taking "our jobs", there are growing reports that many Poles are now deciding to go home.

According to Professor Darius Filar, a member of the Monetary Policy Council at the National Bank of Poland – the equivalent of the Bank of England's Monetary Policy Committee – what started as a trickle of returnees, fed up with wasting their university education doing service industry jobs in the UK, has become a steady stream.

He says: "The main wave of Polish employees seeking jobs in the UK started in 2004. With the low exchange rate of the British pound but also with the deteriorating cyclical situation of the British economy, some of them have decided to return to Poland." The authorities in Poland say they have no exact figures for the number of migrant workers who are returning home as it was impossible to judge how many left in the first place, but Filar says it's a trend the Polish government is keen to encourage. In cities such as Warsaw, local companies report it is near impossible to find enough skilled staff. Although Poland suffers from high employment in rural areas, in the cities firms report that it's common for their employees to be lured away by rival organisations with the promise of 100% pay rises.

"From the point of view of the Polish labour market and the Monetary Policy Council, it (the return of migrant workers] is a positive phenomenon," says Filar. "The Polish labour market is extremely tight recently. We have a very strong pressure on labour purely down to emigration. (The] return of part of these employees could reduce pressure on the labour market and consequently reduce wage pressure and inflationary pressure." Although many Polish migrants tend to work in industries abroad that don't match their education, such as hospitality and construction, Filar says when these people return to the Polish labour market they are usually highly sought after as they have fluent or near fluent English, and often bring back knowledge of how Western businesses operate.

"The majority of these people are quite educated and have had new experiences in the UK," he says. "They create a certain added value in the (Polish] labour market." But while the Polish authorities are keen to reclaim their skilled workers, their departure from the UK, and Scotland in particular, is not sitting comfortably with many business and economic organisations over here, which argue they are vital to the continued health of the economy.

With the Scottish population in decline, Neil MacCallum, expert adviser to the Organisation for Economic Co-operation and Development, says the alarming speed with which Poles are returning home could leave the Scottish economy in dire straits.

The value of the pound has deteriorated rapidly against the Polish zloty, and Poles are not coming to the UK in the same numbers as they were four years ago. At the same time, those who have been making a vital contribution are deciding to leave in large numbers.

"Many of those returning are precisely the people we would want to retain – the young, highly skilled and highly qualified," he says. "A proportion of migrants were always expected to return as prospects improved at home and accumulated wealth allowed these opportunities to be realisable within a shorter time scale.

"However, the speed and composition of those returning leaves problems for a number of sectors in the Scottish economy. In many ways the recent short-term inward migration of skilled workers has papered over the cracks in the economy. This allowed many of the tougher policy issues to be left for another day."

Despite the inevitable reaction it will provoke from right-leaning groups, MacCallum urges the Scottish Government to consider how it can encourage immigrant workers to put down permanent roots. Otherwise, he warns, the Government will struggle to achieve its ambitious growth targets. "Looking at population trends and forecasts it is clear that immigration will be vital to the future growth of the Scottish economy and we must develop strategies that secure permanent settlement."

But British companies are also reaping some benefit from the well-off Poles who are returning home. With a growing middle class and a comparatively under-developed consumer culture, firms such as HSBC are realising there is money to be made from targeting wealthy returnees. In the summer, the bank launched its Premier banking service in Poland, which is aimed at individuals with savings of £50,000 or more and provides access to an independent financial adviser.

And according to the Scottish Council for Development and Industry, Scottish leather goods and whisky are sought after products among Poland's burgeoning middle class. Scotland currently exports around £125m of goods and services to Poland and for some companies it is now their biggest market. It is also one the SCDI is keen to make more of. In January it took 16 Scottish companies to Poland, which resulted in around £700,000 of business.

Firms such as Baxters are also setting up shop in Poland to take advantage of the well educated workforce and Polish wages, which for the moment remain well below UK levels. Two years ago Baxters opened a factory in Wolsztyn in western Poland.

But to encourage Polish companies and their executives and staff to do the same here, MacCallum argues Scotland must recognise its own drawbacks and think how it can better market itself as a destination – not just for a year or two years, but for life. He says: "We are well short of creating an attractive, sustainable location where highly skilled and qualified migrant workers and their families are keen to put down roots."

All roads lead to home eventually
Poles gained the right to work in older European Union states when eight former communist countries joined the bloc on May 1, 2004.

Last year 150,000 Poles took jobs in Western EU states, roughly half lasting three months to a year. The Netherlands was the top choice, with nearly 50,000 workers, while just over 20,000 took jobs in Britain.

A separate labour ministry study tips both the Netherlands and non-EU Norway as the new promised lands for Polish workers as their numbers there swelled in 2007 and are expected to grow.

A study this year by London's Institute for Public Policy Research concluded that "around half" of the estimated one million migrants from EU newcomer states who arrived after May 2004 "have returned home already and that many more will follow suit".

In a bid to eliminate tax phobia and lure Poles home, the government tabled legislation to remove the burden of double taxation on Poles working abroad.







The full article contains 1352 words and appears in Scotland On Sunday newspaper.
Page 1 of 1

  • Last Updated: 04 October 2008 1:33 PM
  • Source: Scotland On Sunday
  • Location: Scotland
 
 

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