Salaries and the subsistence minimum will rise: what Ukrainians should prepare for by 2029
24 June 11:20
The Cabinet of Ministers has set indicative levels for the minimum wage, the subsistence minimum, and the salaries of public sector employees for the next three years. These figures are included in the Budget Declaration for 2027–2029, according to "Komersant Ukrainian"
According to government estimates, the minimum wage will gradually increase from 9,546 UAH in 2027 to 11,114 UAH in 2029. At the same time, there are plans to index the subsistence minimum and the salary of employees in the first pay grade.
However, these amounts have not yet been finalized.
What will the minimum wage be by 2029?
The government plans to raise the minimum wage annually. The monthly minimum wage is expected to be:
- as of January 1, 2027 — 9,546 UAH;
- as of January 1, 2028 — 10,377 UAH;
- as of January 1, 2029 — 11,114 UAH.
Thus, over three years, the minimum wage is set to increase by 1,568 UAH—from the level planned for 2027 to the 2029 level.
The increase in the minimum wage will affect more than just the incomes of workers who earn the lowest legally permitted pay. Certain taxes, contributions, labor guarantees, and benefits also depend on its level.
At the same time, the actual growth in purchasing power will depend on inflation. If goods, utilities, and other expenses rise faster than wages, a nominal increase will not necessarily mean a corresponding improvement in the standard of living.
How Public Sector Salaries Will Change
For public sector employees, whose salaries are determined by the Unified Pay Scale, a gradual increase in the base salary is also planned.
The salary for an employee in the first pay grade is planned to be set at:
- in 2027 — 3,819 UAH;
- in 2028 — 4,151 UAH;
- in 2029 — 4,446 UAH.
This figure serves as the basis for calculating salaries in other pay grades. Therefore, this increase should affect the salaries of employees in education, culture, social services, healthcare, and other public sector institutions that are paid according to the relevant pay scale.
At the same time, an individual employee’s final salary depends on their pay grade, allowances, bonuses, length of service, workload, and funding decisions for the relevant sector.
The subsistence minimum will also be raised
The government plans to increase the general monthly subsistence minimum per person each year.
The projected figures are as follows:
- as of January 1, 2027 — 3,559 UAH;
- as of January 1, 2028 — 3,876 UAH;
- as of January 1, 2029 — 4,151 UAH.
Thus, over three years, the figure is expected to increase by 592 UAH.
The Budget Declaration provides for an increase in the subsistence minimum, taking into account projected inflation. Government calculations call for its indexation at a rate that is expected to slightly exceed the projected growth in consumer prices.
What Is the Subsistence Minimum?
The subsistence minimum is a state-established monetary value representing the minimum set of food, non-food goods, and services necessary for a person.
In Ukraine, separate thresholds are set for:
- children under six years of age;
- children aged six to 18;
- able-bodied individuals;
- people who have lost their ability to work;
- a general per-capita threshold.
Certain social benefits, assistance payments, pension amounts, court-ordered payments, and other calculated amounts are based on the subsistence minimum.
However, the actual expenses of Ukrainian families often significantly exceed the legally defined subsistence minimum.
There are calls to decouple civil servants’ salaries from the subsistence minimum
A separate focus of budgetary policy should be the gradual phasing out of the use of the subsistence minimum as a universal benchmark for calculating official salaries and various payments.
In particular, this concerns the remuneration of civil servants. The current system results in a single social indicator being used simultaneously to assess a person’s basic needs and to calculate salaries, fines, fees, and benefits.
The reform should allow for the use of a separate calculation benchmark for official salaries. This could create the conditions for raising the real subsistence minimum without automatically and sharply increasing all related budgetary expenditures.
However, the specific mechanism for decoupling must be defined through separate amendments to the legislation.
How Social Standards Will Change: Table
| Indicator | 2027 | 2028 | 2029 |
|---|---|---|---|
| Minimum wage | 9,546 UAH | 10,377 UAH | 11,114 UAH |
| Salary for the first pay grade | 3,819 UAH | 4,151 UAH | 4,446 UAH |
| General subsistence minimum | 3,559 UAH | 3,876 UAH | 4,151 UAH |
These figures demonstrate a gradual nominal increase in social standards over the course of three years.
Does this mean an automatic increase in all salaries?
An increase in the minimum wage does not mean that all employees’ earnings will automatically rise by the same percentage.
An employer is required to ensure that wages are no less than the established minimum for a fully completed monthly work quota. For employees whose wages already exceed the minimum, any increase will depend on the employer’s decisions, collective bargaining agreements, the company’s financial situation, and labor market conditions.
For the public sector, changes will depend on the level of the first pay grade, the allowances provided for, and the funds allocated in the state and local budgets.
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How the Minimum Wage Increase Will Affect Sole Proprietors and Employers
An increase in the minimum wage may raise businesses’ labor costs and their payments for the unified social contribution.
The minimum social security contribution is calculated as 22% of the minimum wage. If the rules do not change, the minimum unified social contribution will rise along with the minimum wage.
Approximately, it could amount to:
- in 2027 — about 2,100 UAH per month;
- in 2028 — about 2,283 UAH;
- in 2029 — about 2,445 UAH.
This is merely a mathematical calculation based on the current 22% rate. The actual amounts will depend on the legislation in effect in the respective year, as well as on possible exemptions for certain categories of payers.
Why the projected figures may change
The budget declaration is a medium-term planning document. It does not replace the law on the state budget and does not guarantee that all the indicated figures will remain unchanged.
The final amounts will be influenced by:
- the actual inflation rate;
- the state of the economy;
- state budget revenues;
- the situation in the labor market;
- the duration and intensity of the war;
- the amount of international financial support;
- decisions by the Cabinet of Ministers and the Verkhovna Rada.
It is worth noting that the figures in previous budget declarations could be adjusted during the preparation of the annual state budget. Therefore, the amounts for 2027–2029 should be considered the government’s baseline scenario.
When the figures become final
The next step will be the Verkhovna Rada’s review of the Budget Declaration. After that, the government will prepare the draft state budget for 2027.
The final amounts for the minimum wage and the subsistence minimum for 2027 will be specified in the state budget law.
Similarly, the figures for 2028 and 2029 must be approved separately by parliament when the budgets for each respective year are adopted.
Therefore, Ukrainians are advised to expect a gradual increase in the minimum wage to over 11,000 hryvnias, but the final figures will depend on the economic and security situation.
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