There is a staff shortage in Ukraine

The NBU drew attention to an "unexpected" staff shortage in Ukraine.

In the first quarter of 2022, only 26% of enterprises reported that the lack of employees limited their activities, while in the first quarter of 2024 the share of such enterprises increased to 38%.

According to the NBU, the labor force aged 15-70 in 2023 decreased by more than a quarter compared to 2021.

Almost half of this decline was due to the departure of external migrants from the labor force, although the share of migrants working remotely was 8-10% in 2023.

In about 40% of cases, the decline in the labor force in 2023 compared to 2021 was due to demographic losses and occupation, as well as the transition to an economically inactive population.

The reduction of employees was observed in all regions of Ukraine, most notably in the regions with active hostilities.

The issue of remuneration is of great importance in the search for personnel.

In 2023, competition for employees intensified: businesses are ready to raise salaries to retain their staff, even despite their difficult financial situation.

See the NBU's infographic for the factors behind salary increases in 2021 and 2024.

Staff shortages are forcing businesses to attract groups that were previously less represented in the labor market.

In particular, the hiring of women and people working remotely has increased, while the involvement of veterans and people with pre-war disabilities is still insignificant.

In the future, the return of migrants, the involvement of veterans in civilian life, and the increased participation of people with disabilities in the labor force will be a significant resource for improving the labor market in Ukraine, especially at the stage of rapid recovery, the NBU believes.

"The effectiveness of their involvement will depend on the joint efforts of business and the state, in particular by developing measures for their integration into the labor market, expanding barrier-free access and adaptation in the workplace, including remotely, retraining, etc. Otherwise, the staff shortage will remain a significant constraint on the country's recovery."

To be fair, the government does offer some retraining programs, but it has taken up the task too late, as evidenced by the current situation on the labor market.