Poland: A strategic hub and innovation center in the European business services sector

Poland is solidifying its position as a key hub for business services in Europe. According to the "Delivered from Poland" report jointly published by JLL, Hays Poland, ALTO, and the Polish Investment and Trade Agency (PAIH), Poland became the sixth-largest economy in the EU in 2025, with GDP tripling compared to its accession in 2004 and GDP per capita 40% higher than in a scenario without EU membership. This achievement is underpinned by Poland's systematic competitiveness in knowledge-intensive sectors such as business services, IT, and R&D.

Macroeconomic Stability: From Inflation Shock to Predictable Environment

In 2022, Poland experienced high inflation due to the war in Ukraine and energy market turmoil, with CPI reaching 17-18%. However, by the end of 2023, inflation had dropped to 6%, and in 2024 it stabilized in the 3.5%-4.5% range, close to the National Bank of Poland's target of 2.5%. As of July 2025, price fluctuations have leveled off, providing investors with crucial predictability. A stable macroeconomic environment reduces uncertainty in operating costs, keeping Poland attractive for global business service location decisions.

Labor Advantages: Skills, Scale, and Internationalization

Poland has the largest population in Central and Eastern Europe, about 35 million, of which approximately 35% hold higher education degrees and 63% are of working age. The unemployment rate in early 2025 was only 5.2%, with 6.455 million full-time positions and an economic activity rate of 62.4%. More importantly, Poland has about 1.2 million university students, of which 25% are studying engineering-related fields. The number of STEM graduates is among the highest in the EU, with a leading share of female graduates.

The supplementation of foreign labor further enhances market resilience. Nearly one million workers come from Ukraine, Belarus, and Central Asia, accounting for a significant proportion of total employment. In the business services sector, foreign employees account for 19.6%. Radosław Pituch, Manager of the Investment Department at PAIH, notes: "Polish professionals are known for their excellent language skills, adaptability to new technologies, and innovative thinking. Years of cooperation with Western companies have made them well-versed in international business practices."

Evolution from Cost Competition to Strategic Value

Poland's business services sector has moved beyond mere cost advantages. As of 2025, the country hosts over 2,000 BPO, SSC/GBS, IT, and R&D centers, employing more than 480,000 people, with the sector's contribution to GDP estimated at 5.7%. In 2024, exports of knowledge-intensive business services reached $42.3 billion, a 15% increase over 2023.

Łukasz Grzeszczyk, Managing Director of Hays Poland for Central and Eastern Europe, observes: "After setting up a shared services center in Poland, investors often decide to expand factories or R&D centers and transfer global responsibilities to Poland. Although demand for entry-level positions is declining, demand for specialists continues to grow—this perfectly illustrates the evolution of Poland's image: from low-cost competition to a strategic location for advanced, highly specialized projects."## Investment Incentives: A Competitive Policy Mix

Poland's investment incentive system has significant advantages in Europe. Iwona Chojnowska-Haponik, Director of JLL Business Location Consulting, stated: "Poland allows one of the highest levels of state aid in the EU—large enterprises can receive subsidies up to 50% of eligible investment costs. A variety of instruments (such as R&D tax credits) and a clear application process enable companies to effectively reduce costs." According to OECD indicators, Poland's R&D tax incentive intensity ranks among the highest. Tobiasz Dolny, Tax Partner at ALTO, added that the rapid advancement of e-government (e.g., the national e-invoicing system) further improves the predictability and cooperativeness of the tax environment.

Office Market: Adapting to the New Hybrid Work Norm

Over the past decade, Poland's office space has grown from 7.1 million square meters to over 13 million square meters. The business services sector contributed more than 60% of demand outside Warsaw. However, after the pandemic, hybrid working models have reshaped space requirements. JLL surveys show that a significant proportion of BPO/SSC employees work remotely more than three days a week. Employers are re-evaluating office functions, shifting from fixed workstations to collaboration and flexibility. This transformation is driving office property upgrades, while regional cities such as Krakow and Wrocław continue to benefit from industry dispersion.

Long-term Trends: The "Polish Node" in Europe's Business Services Network

Poland's strategic position is not only a result of market choices but also a product of EU policies and deeper regional integration. As a net beneficiary of EU funds, Poland's investments in digitalization, transport infrastructure, and human capital will continue to enhance its competitiveness. At the same time, Poland is transforming from "Europe's cheap outsourcing destination" into a "deep tech solutions hub." ABSL data shows that 61 new service centers were established between 2024 and the first quarter of 2025, with 58.6% of positions requiring advanced knowledge levels.

Looking ahead, Poland's business services sector will face two key challenges: first, maintaining the quality of talent supply, especially the continued output in STEM fields; second, coping with competition from other low-cost European countries (such as Romania and Bulgaria). However, Poland's comprehensive advantages in market size, industrial maturity, and policy support position it to remain a core hub for European business services in the medium to long term. For companies seeking European expansion, Poland is no longer an experimental choice but a strategic core node.