Kraków, once a leading hub for global business services in IT, finance, HR, and accounting, is now facing a dramatic slowdown as AI accelerates automation of white-collar tasks.
According to reports, over 4,195 employees across 32 companies in Kraków are set to be dismissed, marking a 70 percent increase in announcements compared with 2024. These job cuts mainly affect roles in data processing, accounting, tax consultancy, and other process-driven functions—workloads that AI can increasingly handle.
Major corporations including Shell, Heineken, HSBC, and UBS are among those cutting or relocating simpler operations. Rising labor costs in Poland are also eroding the traditional cost advantage that drew these firms to Kraków.
Impact on Real Estate and Local Economy
As firms shrink or close their offices, Kraków’s real estate sector is feeling the strain. Office vacancy in the city reportedly hit 18.6% in Q3 of 2025, up from 17.3% earlier in the year. Developers say companies are cutting space or giving up long-term leases as they scale back.
The slowdown in outsourcing is also rippling through the local economy. Cafés, restaurants, and boutique shops that catered to well-paid corporate staff are seeing declining demand.
City Adapts with Upskilling and Innovation
City officials are pushing back against doom-and-gloom narratives. Kraków’s deputy mayor, Stanisław Mazur, emphasized that the city is evolving rather than collapsing.
To that end, Jagiellonian University recently launched an advanced AI research center and opened a competitive AI education program. In 2024, only 176 candidates applied for 20 spots—highlighting strong demand for high-tech talent.
Experts argue this transformation signals a larger shift: Kraków must move from being a low-cost outsourcing destination to a value-creating technology hub.
