Employment and labour productivity in agriculture : evidence from Poland

Abstract

PURPOSE: The objective of this article is to estimate potential surpluses of 'unproductive' employment in Polish agriculture and its potential 'optimum', assuming that optimal employment occurs when GVA per employee in this sector is equal to GVA per employee outside agriculture.

DESIGN/METHODOLOGY/APPROACH: The article considers employment in Polish agriculture as a whole and in voivodeships in the context of labour productivity. The aim is to find the level of employment in agriculture at which GVA per employee in agriculture will be equal to GVA per employee outside agriculture. In the article, this is conventionally referred to as "optimal" employment. Surplus employment above this level is referred to as "unproductive" employment. The calculated level of employment has an economic dimension and does not take into account the actual demand for labour. It is therefore a reference point for formulating policies for the evolution of the sectoral structure of employment and not its goal in the strict sense.

FINDINGS: The unproductive employment rate (UER) in agriculture estimated in the article averaged 63.5% in Poland, which means "unproductive" employment of 810,100 people and optimal employment of 466,300 people. Overemployment is higher in voivodeships where the average farm size is small and decreases as the average farm size increases. The process of increasing productivity in agriculture is therefore linked to a further reduction in employment and labour input and to the concentration of agricultural land use, which allows economies of scale to be exploited.

PRACTICAL IMPLICATIONS: The process of land use concentration should be supported by promoting forms such as leasing, the creation of cooperatives and producer groups, and the use of agricultural services provided by specialised entities or technically better equipped farms. Such solutions enable economies of scale to be achieved, similar to those of larger farms, and reduce the technologically determined demand for labour. The freed-up labour can be used outside agriculture on a full-time or part-time basis, without necessarily giving up agriculture altogether. This is an opportunity to optimise labour input: during busy periods, it will help to reduce labour shortages, and during seasonal downtime, it will avoid labour wastage and generate income from outside agriculture.

ORIGINALITY/VALUE: The contribution of the article stems from the definition of a reference point for agricultural, social and macroeconomic policies in terms of striving for cross-sectoral labour productivity balance, which helps to reduce income disparities between the agricultural and non-agricultural populations and facilitates the achievement of sustainable development goals. The article also shows the differences in this respect between the voivodeships studied and points to the practical implications of this phenomenon.