Labor market in Ukraine: current challenges and risks

Abstract

The article analyzes the situation on the labor market in Ukraine, starting before COVID-19 pandemic and up to present. It is noted that in recent years Ukrainian labor market is characterized by transformation stage, accompanied by specific negative consequences, including reduced productivity, deteriorated employment conditions, non-standard employment segment expansion and more. Professional occupation imbalance of supply and demand is significant on the national labor market. It increasingly loads regional labor markets, rasing the level of unemployment and social tension in the country. All these negative consequences rised up with COVID-19 pandemic and invasion of Ukraine by Russian Federation troops. It is noted that the main domestic labor market changes caused by COVID-19 pandemic during 2019–2021 are: decreasing employment; increasing unemployment rate; decreasing number of labor migrants; decreasing population incomes in labor force sale and self-employment because of job loss, decreasing salaries and entrepreneurs’ income. New trends in labor market caused by war in Ukraine are analyzed. As a result of war, the salaries of Ukrainians decreased, some specialists lost their jobs, and some professions lost their demand on the market. Companies were forced to relocate their businesses to safer regions, so the labor market structure changed depending on the region. Demand for work exceeds its supply, unemployment is high. It is defined that after having overcome the crisis caused by COVID-19 pandemic and war, there will be a need to attract more labor and expand employment opportunities on the Ukrainian labor market. Therefore, one of the important tasks of the state now is to create a clear system of priorities for employment. Among them: saving and developing human capital, creating incentives for employment and service export, deregulation and transparency of rules.