Unemployment in Ukraine has increased significantly, and people's incomes have fallen: what to expect in 2023
The unemployment rate in Ukraine in 2022 have increased from 9.8% to 25.8%. This was the result of the destruction of enterprises and a decline in business activity amid high risks and the forced migration of millions of Ukrainians. At the same time, unemployment in Ukraine will remain high in 2023. In addition, wage cuts by some businesses and high inflation have led to a drop in real incomes of Ukrainians.
The National Bank of Ukraine reported this. They noted that despite active hostilities, the labor market began to recover at the end of 2022, but this process was slowed down by Russia's full-scale attacks on Ukraine's energy infrastructure.
Unemployment will remain high
However, the regulator noted that unemployment in Ukraine will remain high in 2023. Moreover, the number of applicants will exceed the number of vacancies.
Still, it is emphasized that "businesses will try to retain their existing staff." It's expected to be done by raising wages.
When the unemployment rate starts to decline
According to the National Bank of Ukraine, the situation on the labor market will improve when two factors come into play. They are:
- reduction of security risks;
- economic recovery.
"Ukraine's recovery will require hiring more workers. Therefore, the National Bank of Ukraine expects the unemployment rate to start declining in 2024 and the growth of real incomes of Ukrainians to accelerate," the regulator said.
In addition, they emphasized, household incomes will also increase due to the continued high level of budget support, including social spending. "Although, the consequences of the war will still be keenly felt in the labor market, in particular due to increased qualification and regional imbalances," the NBU admitted.
As OBOZREVATEL previously reported, according to Opendatabot, there were more open vacancies than resumes in Ukraine in February 2023. In addition, the number of vacancies increased by 11% compared to January. Most often, Ukrainians aged 16-24 are looking for work - there are almost twice as many of them as job seekers in the 25-35 age group.
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