At Tuesday's meeting, the government adopted a proposal for the minimum wage that will apply next year. The lowest earners can count on a raise of approximately 3%. According to estimates by the Ministry of Labor and Social Policy, he receives the minimum wage in Poland approximately 3 million people.
This increase in the minimum wage is one of the smallest in recent years.
Minimum wage 2027. What do the increases depend on?
The minimum wage, in accordance with Polish regulations, must increase by at least the projected price increase (inflation). The idea is to ensure that wages do not lose purchasing power over time, i.e. that the increases are not smaller than the pace at which prices are rising, because this would mean that over time an employee could buy less and less for the same work. This is the basic mechanism of valorization.
For many people, the proposal to increase the minimum wage by 3%. may seem unfair, considering the scale of the increases in previous years. Let us remind you that the minimum wage in Poland has increased by PLN 3,056 over the last 10 years. The largest increase was recorded in 2024. Then, as of January 1, the salaries of the lowest earners increased overnight by less than 18%. A year earlier, the jump was also impressive – by almost 16%.
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The last significant increase in the minimum wage took place at the beginning of 2025. Then it amounted to 8.5%. This year it was “only” 3%.
However, it should be noted that last year the average price increase slowed down from less than 5%. up to approx. 2.5 percent On the other hand in the months preceding the exceptional increase in the minimum wage from January 1, 2024, inflation was double-digit for a long time, and at its peak even exceeded 18%.
The voices in favor of a return to double-digit minimum wage increases are, in practice, arguing for a return to the times when prices got out of control and were able to rise in a month at a rate that would normally be expected in a year.
Minimum wage and inflation. Different points of view
In practice, however, much depends on the point of view. Most people are better off with low inflation and moderate wage increases than with very high inflation and very high wage increases.. High nominal increases make a great impression, but in themselves they do not indicate an improvement in the standard of living. If someone earns PLN 5,000 and after a year PLN 6,000, they may seem richer. However, if the prices of housing, food, energy and services increased by 20-25% at the same time, in reality his situation may not have improved, or even worsened.
From the perspective of a minimum wage worker, high inflation may initially be beneficial if wage increases keep pace with or outpace price increases. The problem is that increases tend to lag inflation. Prices can rise throughout the year, and the minimum wage is only raised later. As a result, purchasing power declines for some time. Additionally, not all employees receive automatic raises. Some people earning just above the minimum wage may find that their wage increases slower than the minimum wagewhich reduces the differences between positions.
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From a retiree's perspective, high inflation is even more problematic. Pensions are indexed, but, like minimum wages, they react with a delay. When prices rise quickly, the real value of benefits declines for a period of time. People who have savings in cash or in low-interest accounts also lose as inflation reduces the value of their accumulated capital.
For entrepreneurs, high inflation means greater uncertainty. It is more difficult to plan investments, set prices and predict labor costs. Small companies in particular may have problems financing sharp increases in the minimum wage. On the other hand, some companies may find it easier to pass on rising costs to customers by raising prices, which in turn fuels further inflation.
From the government's point of view, moderate inflation is often easier to manage than very high inflation. With high inflation, tax revenues in nominal values are increasing, but at the same time there is greater pressure on public sector wage increases, pension indexation and various social programs. Long-term high inflation may also weaken confidence in the economy and currency.
In practice, advanced economies typically aim for low and stable inflation, around a few percent or less, because it provides greater predictability and allows wage increases to translate into real welfare gains.. Very high minimum wage increases are politically attractive and look good in numbers, but if they are mainly a response to very high inflation, they often represent only an attempt to keep up with rising prices, rather than actually making society richer.
