This article is a part of Poland Unpacked. Weekly intelligence for decision-makers
Seasonally adjusted industrial output rose by 0.8% year on year in November, according to preliminary data from Statistics Poland (GUS). This is broadly in line with October, when output increased by 1.1% year on year. Before seasonal adjustment, November’s production was 1.1% lower than a year earlier, reflecting a smaller number of working days. The result is not bad, though it leaves something to be desired.
Interactive chart Capital goods are powering industry
Interactive chart The most important fault line in industry now runs along the type of goods produced. Of the five main categories, one stands out clearly on the upside: capital goods. Over the past three months, their output has risen by an average of nearly 10%. Since mid-2025, a recovery has been visible among producers in this segment. Two factors are driving it.
The first is domestic investment, bolstered primarily by funds from the National Recovery Plan (KPO). This is where these resources are being channeled – rather than into construction. The second factor is demand from the euro zone, reflecting an investment upswing linked to the energy transition.
Good to know
KPO
The National Recovery and Resilience Plan (KPO) is a development strategy outlining Poland’s objectives for rebuilding and strengthening the country’s socio-economic resilience following the COVID-19 pandemic, along with the reforms and investments needed to achieve them.
The investments and reforms defined in the KPO are intended to restore the economy’s growth potential lost during the pandemic, enhance competitiveness, and improve living standards.
Producers of other types of goods are faring less well, though the past few months have brought a modest improvement. Output of durable consumer goods grew by 4.3% year on year; for non-durable consumer goods the figure was 4%, and for intermediate goods 2.8%. Demand for intermediate goods is clearly beginning to recover, despite weak conditions in Poland’s key export markets. Demand for durable consumer goods is also improving, likely driven by higher consumer spending at home.
The only category to record a year-on-year decline in output was energy-related goods. This group includes, among other activities, coal mining as well as the production of fuels and electricity. The fall in output – measured in value terms – has been driven mainly by declining commodity prices. From the perspective of the economy as a whole, this is, in fact, good news
In the months ahead, I expect the favorable conditions in capital-goods production to persist. This will be driven by continued, elevated spending of funds from the National Recovery Plan (KPO), which must be absorbed by the end of 2026, as well as by disbursements from the EU budget. Conditions may also improve somewhat for producers of intermediate goods and durable consumer goods, though much will depend on developments in the euro zone. And there, the growth outlook remains uncertain.
Construction still waiting for a rebound
Data on construction and assembly output were also released, showing a seasonally adjusted year-on-year decline of 1% in November. Hopes for a long-awaited recovery – rekindled by October’s reading of 3% year on year – proved misplaced. Output disappointed most notably in civil and hydraulic engineering, where production fell by as much as 12.8% year on year.
Construction remains in the doldrums. The reasons include a weaker-than-expected pickup linked to the National Recovery Plan (KPO) and a subdued property market. Next year, however, the situation should finally begin to turn. Investment financed by the KPO and EU funds is set to accelerate, while real estate should benefit from lower interest rates.
Key Takeaways
- Capital goods are driving industrial growth – Investment goods production has rebounded strongly, rising nearly 10% on average over the past three months, supported by domestic spending from the National Recovery Plan (KPO) and renewed demand from the euro zone.
- Other industrial segments show modest improvement – Output of durable and non-durable consumer goods, as well as intermediate goods, is gradually recovering, though growth remains moderate and sensitive to conditions in key export markets.
- Construction remains in the doldrums – Construction and assembly output fell by 1% year on year in November, weighed down by slower-than-expected KPO-related spending and a soft property market, though conditions are expected to improve next year with renewed public investment and lower interest rates.