A brief introduction
The disruptive potential of digitalisation and automation has led to the development of related technologies being referred to as the “next industrial revolution” or “industry 4.0” (after the age of steam, electricity and computers). As researchers point out, historically, the negative effects of technological change affecting employment are offset in the long term by changes in economic systems. However, in the short and medium term, they have often had disastrous consequences, both social and political.
From the point of view of many Polish industries, such as packaging or metal processing, Industry 4.0 may threaten the competitiveness of Polish companies in the European market. This will happen unless they start using digital technologies more widely in their production facilities and make them the basis of their business.
Poland in the face of the trend
The megatrend of automation and digitalization of work and the related transformation to the Industry 4.0 model can therefore be both a threat (especially in view of the low adaptability to reality) and an opportunity for Poland.
In the short term
This trend can be assessed as dangerous for the country’s further development prospects – given the current model of competitiveness of the Polish economy. Therefore, of particular importance, decisive from the perspective of the future of the Polish labor market in the next decades, would be the real decisions and actions of the government aimed at modernizing the Polish economy, and replacing the hype (but still too rarely formulated) political announcements.
Otherwise, our country’s primary competitive advantage will remain low prices – both in the domestic market and among export-oriented companies – mainly due to low labor costs. For comparison: despite the increase in real wages in recent years, the average wage in Poland in 2018 was 33.82 percent of the average wage in the EU as a whole, but only 25.18 percent of the average wage in Germany, the main export destination for Polish goods (data after CSO and Eurostat).
Lazy innovation in an aging society
As diagnosed in the government’s Strategy for Responsible Development, the Polish economy is characterized by a low level of innovation, resulting, among other things, from low demand for new technologies among Polish companies. Add to this the low interest in developing domestic intellectual capital. All this means that the automation of work and its digitization is not progressing very quickly.
According to data from the Central Statistical Office, total R&D (research and development activity) expenditures have remained at no more than 1 percent of GDP since 2002, and among companies in 2016 this share was 0.63 percent. In Polish industry, traditional sectors that produce low-value-added products, such as agriculture and mining, still play an important role? However, it’s not just about innovation for innovation’s sake. With our country’s aging population, solutions to replace workers will be indispensable for being able to counteract recurring economic recessions and provide benefits for the next generation of retirees.
Will labor automation slow down in Poland by coronavirus?
Extremely important questions to ask, therefore, concern what will happen in the Polish economy when it becomes more profitable for German entrepreneurs to invest in automation in their own plants than to import needed services and products from Poland. And also: in the longer term of a few decades – going beyond the current impending economic crisis resulting from the coronavirus pandemic – will the Polish economy have time to assimilate and anticipate the subsequent consequences associated with the development of Industry 4.0 and labor automation.
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Author: Tomasz Wołowiec, PhD, WSEI university Lublin / Poland
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