Domination of one type of industry
Some towns and regions were dominated by only one type of industry or a heavy industry which underwent crisis in 90-es. Regions with heavy industry (Starachowice, Walbrzych - brown coal industry) or with one dominating industry, like for instance textile (Lodz area) or shipyard industry (Gdansk). We will write more about it in the following article about structural unemployment. Since the fall of the heavy industry there are regions where an unemployment reaches 30% and also there are towns (Warsaw, Poznan) were unemployment is very low. The fall of the industry is partly related to the old economic structure which was bounding all Eastern European communist countries into mutual dependence on one another, more about it in the next point of our analysis below.
Change in the industrial structures after the fall of communism in the Eastern Block
Poland was also very dependent on other Eastern European countries, especially Soviet Union in the export and also import. All Eastern Europe countries' economies were mutually dependent on each other and all were especially dependent of Soviet Union. The economical crisis affected all Eastern Europe, so we were unable to receive needed products from other EE (Eastern European) countries - in order to continue production in our country as well as we were not able to sell our products to the other countries since they were in crisis. Similar situation happened also in Finland which was not really a communist country. Finnish industry was heavily dependent on Soviet Union. Although Finland did not undergo any rapid change in their political and economical system, the crisis in Soviet Union affected their economy and caused rapid increase of unemployment in early nineties.
Too many people sustained their living from agriculture in small and inefficient households. Some, so called "chlopo-robotnik" (farmer- industrial worker) were working partly at home and partly in the neighboring town. The regions with highest unemployment are traditionally dominated by farming industry (northern and eastern regions of Poland) with very little of industrial development. The demographic structure in villages in these regions is very strange consisting mainly of older people and children while people in production age are gone to work in the towns.
Communist relics in state run agriculture farms
Northern and western regions of Poland which were incorporated after War World II, are additionally plagued by a legacy of communism since many people were working not on their farms but in so called (PGR - Panstwowe Gospodarstwo Rolne), something similar to Russian kolchoz. PGRs were always subsidized by government and the efficiency there was much lower than on the private farms. People who worked there have a hard time to get used to being on their own. They are not very mobile and they have trouble to work on their own since they always worked for the government.
Unfortunately the Polish unemployment is not only a result of the phase in a capitalistic economy, it is a long-lasting phenomenon which is also affected by the mentality of the people and the lack of needed services which I explained partly in the most recent article of this series: Unemployment among older and less educated people.
Some of the featured of Polish unemployment belong to so called structural unemployment. We will talk more about it in the next article. Check all the articles about unemployment in Poland and a state of Polish economy in general.