Ukraine’s labor market weathered the turmoil of war, study finds
22 February 16:14
According to a study by the Berlin-based Rockwool Foundation, four years after the start of the full-scale Russian invasion, the labor market in Ukraine is showing remarkable resilience, contrary to fears. The unemployment rate, which exceeded 20 percent in the first months after the start of the war, is now around 11 percent — only a few percentage points higher than before the war, Reuters reported on Sunday, February 22, citing the results of the study, according to "Komersant Ukrainian".
Real wages (the amount of goods and services that can be purchased with a nominal salary) have returned to pre-war levels and even exceeded them after a decline observed until 2024, analysts said.
“Victories in long wars are often won in factories, not on the battlefield. The Ukrainian labor market has withstood shocks of unprecedented scale,” said one of the study’s authors, Tito Boeri, a professor at Bocconi University in Milan. He noted that Ukraine has experienced a “surprisingly rapid” redistribution of labor under conditions of extreme stress.
Ukraine’s working-age population has shrunk by a quarter
After the start of Russia’s full-scale war against Ukraine in February 2022, the Ukrainian labor market experienced shocks of historic proportions. Experts say that the departure of a large number of people of working age from the country alone resulted in the loss of about 3 million workers. At least another 500,000 people were called up for military service, and 150,000 died as a result of military operations.
Overall, the working-age population in regions controlled by the Ukrainian government has shrunk by about a quarter, the study notes.
Changes in the labor market in Ukraine
Since the start of the war, economic activity in Ukraine has shifted from the front line to the western regions, and employment in the defense industry has increased. Researchers also attribute the resilience of the Ukrainian labor market to flexibility in wages and hiring practices, as well as opportunities to work outside the office. In addition, the growth in female employment, including in traditionally male-dominated sectors, has played a positive role.
Meanwhile, the International Monetary Fund (IMF) forecasts Ukraine’s economic growth in 2026 at 4.5 percent. This figure fell by more than a quarter in 2022, but then began to rise again.
