Recovery in construction activity weaker than expected
According to data released by Statistics Poland today, construction and assembly production expanded by 6.7% YoY in August, following a 2.3% YoY decline in July, printing below both our forecast (10.0%) and market consensus (6.8%). Seasonally adjusted construction and assembly production went up by 1.9% MoM.
The strong acceleration of construction and assembly production growth was consistent with our assessment a month ago (see MACROpulse of 20/08/2026). At the time, we argued that July’s decline had been partly temporary, reflecting unusually irregular post-completion settlements that may have shifted some reported output into August. As this effect faded, production rebounded markedly in August. Activity was also supported by the need to complete some of the projects financed under the National Recovery Plan by the end of August, which contributed to an acceleration in construction work co-financed by EU funds. This was reflected primarily in an acceleration in construction and assembly production in the “civil engineering works” category (29.0% YoY in August vs. -0.1% in July), which added 12.2 pp to overall construction and assembly production growth.
At the same time, the output in the “construction of buildings” category fell sharply (-19.6% YoY in August vs. -1.8% in July), reducing the overall construction and assembly production growth rate by 5.8 pp between July and August. The decline most likely reflected weaker non-residential construction activity, as the housing market data released today (building permits issued, housing starts and dwellings under construction) did not indicate a sharp decline in activity in that segment.
Slowdown in wage growth
According to data published today by Statistics Poland, the employment growth rate in the enterprise sector remained unchanged in August compared with July, at -0.8% YoY, in line with our forecast and market expectations. At the same time, the number of FTEs went down by 11.1k MoM. This is consistent with our assessment that the year-on-year decline in employment in the enterprise sector observed since Q4 2023 is largely due to employees reaching retirement age.
Meanwhile, nominal wage growth in enterprises employing more than 9 people slowed from 6.8% YoY in July to 5.6% YoY in August, coming in below the market consensus (6.6%) and our forecast (6.5%). The slowdown was partly related to the fading impact of the strong wage growth in the mining and energy sectors recorded a month earlier. Together, these two categories reduced annual wage growth by approx. 0.7 pp between July and August. It is worth noting, though, that the slowdown in wage growth was broad-based and was recorded across the vast majority of categories reported by Statistics Poland. Nonetheless, we continue to believe that wage pressures in the enterprise sector remain moderate. Slower nominal wage growth and higher inflation (see MACROpulse of 15/09/2026) reduced real wage growth to 2.1% YoY in August, from 3.7% in July. As a result, real wage bill growth slowed to 1.3% YoY in August vs. 2.8% in July and 1.7% in Q2. This poses a downside risk to our forecast, which assumes an acceleration in consumption growth from 2.8% in Q2 to 3.1% in Q3. Tomorrow’s retail sales data for August should provide a clearer picture of the outlook for private consumption.
Slight downside risk to our Q3 GDP growth forecast
Today’s data on construction and assembly production, wages, and employment in the enterprise sector combined with last week’s industrial production data point to a slight downside risk to our Q3 GDP growth forecast (3.7% YoY vs. 3.9% in Q2). Today’s data also support our assessment that the adverse impact of the conflict in the Middle East on economic conditions in Poland remains limited.
We believe that the overall tone of today’s data from the Polish economy is neutral for the PLN exchange rate and Polish government bond yields.
