Post-restructuring productivity of the Polish hard coal mining industry. Does it create an opportunity for survival or a threat of closure?

Izabela Jonek-Kowalska and Wieslaw Grebski

Resources Policy, 2025, vol. 100, issue C

Abstract: Decarbonization and the ban on public aid for mining companies have intensified the threat of liquidation for the Polish hard coal mining industry. Nevertheless, liquidation of hard coal mining has resulted in a significant decrease in Poland's energy security. Therefore, resolving the dilemma of survival or liquidation may depend mainly on economic conditions related to productivity and efficiency. Considering the aforementioned circumstances, this study aims to assess productivity and its determinants in the Polish hard coal mining industry from 2018 to 2023, that is, after the liquidation of permanently unprofitable mines following the recommendations of the European Union and its decarbonization policy. The study conducts an assessment of labor productivity and efficiency, as well as trend and dynamics analyses to identify the changes in employment, production, and remuneration. The results indicate lack of efficiency and productivity effects of the restructuring (average annual rate of change in the work productivity is −2.81%). Employment declines extremely slowly, and the reduction is inconsistent, while remuneration increases rapidly (over 10% annually and constitutes 38–89% of the price of 1 ton of coal) at an above-inflation rate. These observations imply an accelerated path toward the liquidation of hard coal mining in Poland. Changing such a pessimistic scenario would require a radical improvement in productivity and efficiency, which seems unlikely under the prevailing economic and geological conditions. The study contributes to the analysis of the mining industry by presenting the microeconomic (neither holistic nor econometric) approach. Furthermore, it identifies the determinants of mining productivity in emerging and developing economies. Additionally, this study draws attention to the threats to the industry resulting from ineffective restructuring activities and the separation of mining companies' operating principles from economic conditions. These are important implications for the less frequently discussed issue of mining enterprise productivity.

Keywords: Work productivity; Efficiency; Remuneration; Employment; Polish coal mining; Restructuring (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jrpoli:v:100:y:2025:i:c:s0301420724008237

DOI: 10.1016/j.resourpol.2024.105456

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