The National Bank predicts that the unemployment rate will drop to 14.2% in 2024 and 10-12% in 2025-2026, and real wages will exceed their pre-war level and will rise in the future. This is discussed in the NBU inflation report.
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Unemployment
Unemployment will still be higher than before the full-scale invasion due to changes in economic structure, external and internal migration, uneven recovery across regions and sectors, and then increasing mismatches between employers' needs and workers' skills.
Estimated NBU, the labor force aged 15-70 years in 2023 decreased by more than a quarter compared to 2021. Almost half of this reduction was due to the departure of external migrants from the labor force.
Demographic losses and occupation, as well as the transition to economically inactive populations, played a significant role (about 40% of the labor force decline in 2023 compared to 2021).
The decline in labor force participation was widespread across all regions in Ukraine, most noticeably in regions with active hostilities.
Wage growth
Due to the discrepancy between labor demand and supply, at the beginning of 2024, as in 2023, pressure remained to increase wages both from job applicants and from wage increases by employers.
Salaries increased at a high rate, as evidenced by both indirect indicators of assessing household incomes and increased wages in vacancies and resumes on search sites.
Further growth in wages in 2024 as a result of increased competition for workers, especially highly qualified ones, is confirmed by the plans of enterprises.
In addition to the personnel shortage, the increase in wages was also affected by the increase in the minimum wages (by 6% since January and by almost 13% since April 2024).
