* Polish unemployment is at post-communism low

* Wage growth hit five-year high in August

* Pressures may spill over into higher inflation

By Marcin Goettig

WARSAW, Nov 3 (Reuters) - Warsaw-based roofer Adam Wojtkowski says demand for his services is so high that he can cherry-pick customers, despite prices in the business having risen by around a quarter this year.

Although the work he does is seasonal, his situation reflects wider trends in Poland's $505 billion economy, where wages are being driven higher by record-low unemployment, a surge in social spending and by its expanding role as a regional business destination of choice for multinationals.

Corporate wage growth hit a five-year high of 6.6 percent in August and some analysts expect that to increase as the country ramps up plans to spend 86 billion euros ($100 billion) of EU aid allocated until 2022.

"There are acute shortages of people to hire for work," Wojtkowski said. "We are not able to carry out one third of the orders we get now."

Economic growth is tipped to rise to a six-year high of 4.1 percent this year, and a key question for economists is whether higher wages will be sufficiently offset by higher productivity to keep inflation in check.

Central Bank Governor Adam Glapinski seems confident that it will.

After exiting deflation in late 2016 and with inflation running below the bank's target, he reiterated in October he saw no reasons to raise benchmark interest rates from their record low of 1.50 percent until the end of 2018. But markets are betting the first hike may come sooner, as six out of 10 rate-setters have suggested.

Unemployment fell to 6.8 percent in September, the lowest since the country's transition from communism in the early 1990s, and the evidence points to it staying low.

Only 16 million of Poland's 38 million citizens are currently working in the country, partly because an estimated 2.3 million mostly young people left to seek a better life in richer parts of Europe, statistics office data show.

Those workers that remain are relatively well-educated but the average corporate wage 4,473 zlotys ($1,228) per month is still less than a third of that in Germany.

That combination is attracting growing interest from foreign firms.

In the last two months, U.S. bank JPMorgan Chase said it will hire 3,000 people in its new Warsaw business services hub and Korea's LG Chem announced plans to open Europe's largest car battery plant in Poland. Adding to pressure on the labour market is the ruling Law and Justice (PiS) party's decision to reverse a hike in the retirement age from October, potentially cutting the workforce by a further 2 percent. Many of the gaps are currently being filled by hundreds of thousands of mostly short-term workers from neighbouring Ukraine, whose arrival has helped keep wage growth below the double-digit levels it has reached in Hungary and Romania. INFLATION CONCERNS

Annual inflation eased to 2.1 percent in October from a seven-month high of 2.2 percent in September, still below a central bank target of 2.5 percent. That trend may not last.

"I think that inflation in the first half of 2018 will exceed 2.5 percent," said Jaroslaw Janecki, a Warsaw-based economist at Societe Generale. "We are ... close to a situation where rising labour costs start translating into higher prices".

Such a development would probably spur the central bank into action, and the scale of monetary tightening priced in over the next 12 months by markets rose to its highest level in 3 years on Thursday. One 25-basis point rate hike is now fully priced in by October 2018.

Capacity utilisation reached a nine-year high in the third quarter, according to the central bank, and double-digit growth in industrial output over the same period signalled a rise in partly EU aid-driven investment.

But firms may remain wary of committing to too many new projects, given the new taxes on banks and wind farms that the PiS introduced in 2016. And without robust investment growth, Poland may struggle to prevent higher wages from feeding into higher inflation, said Frank Gill, lead analyst for Poland at rating agency S&P Global.

"We think that we are pretty close to full employment and that the current pace of wage growth is going to increase," Gill told Reuters in October. "Wage growth is not a bad thing, as long it doesn't race too quickly ahead of productivity growth."

($1 = 3.6552 zlotys)

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Poland vs Hungary: Wage growth Poland's interest rates ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Marcin Goettig; editing by John Stonestreet)