All hands on deck: How Ukraine’s labor market is coping with a shortage of men

RU

Shrinking population

Before Vladimir Putin’s full-scale invasion, Ukraine was home to some 41 million people, 19 million of whom were men. As the Institute for Demography and Life Quality Problems of the National Academy of Sciences of Ukraine estimates, by Jan. 1, 2024, the country's population had shrunk to 36.3 million people — or even 31.5 million, excluding those residing in Russian-occupied territories. The data is preliminary, as ongoing hostilities make it impossible to provide a more accurate estimate.

In addition to people dying from Russian weapons on the battlefield and in their homes, Ukraine is also losing migrants and refugees, who are building a new life abroad and are increasingly unlikely to return. As of June 2024, 4.3 million Ukrainians had obtained temporary protection status in EU countries. Around 20% of them are men, and the rest are women and children.

An acute labor shortage has been a heavy burden for Ukraine's economy. In the first months of the full-scale war, many enterprises were closing, and workers were faced with unemployment. From mid-2023 onwards, however, the number of openings has been growing, and today's rate of new jobs added to the economy per day has already surpassed pre-war levels. The Ukrainian labor market is undergoing a rapid revival, and the demand for new hires is also growing. The central bank expects the unemployment rate to drop from 18.2% to 14.2% before the end of the year.

However, due to the impact of mobilization and migration (both external and internal, which itself totals 5 million people), there are more jobs than applicants. According to the European Business Association, 74% of Ukrainian businesses are currently understaffed. To compare, only 55% of employers reported a shortage of human resources in the fall of 2023.

The men are gone

The Ukrainian Ministry of Defense is not disclosing its number of active servicemen and potential recruits, but experts believe that the mobilization effort could affect a few hundred thousand more reservists. The law on expanding mobilization activities that came into effect in May 2024 decreased the draft age from 27 to 25 years old and abolished the “limited eligibility” status. As Verkhovna Rada deputies remarked, the law yielded quick results, allowing the military to draft more servicemen in May than they had been able to in the preceding months.

Meanwhile, surveys suggest that businesses primarily blame mobilization for the workforce shortages. Nevertheless, the actual scope of military recruitment (a few hundred thousand people) made less of an impact than the soaring numbers of draft dodgers, who either go into hiding or leave the country, contributing to “brain drain.” As a result, despite men making up only one-fifth of Ukrainian refugees, the share of women in the domestic labor market has seen a steep increase.

Ukraine's mobilization potential is assessed to be 4.8 million men. Enterprises can afford to obtain exemption certificates for only one-half of their employees who are eligible for military service. Business owners insist that this proportion is not enough to overcome the lack of human resources.

Small enterprises are particularly vulnerable. Private shops have no idea how they are supposed to continue operations with no one to handle deliveries. In Ukraine, most truck drivers and freight handlers are men. As of Jul. 1, jobs typically viewed as “male” — freight handlers, engine drivers, truck drivers, train assembly workers, and so on — had the most openings.

Hiring a plumber and other utility workers is also problematic, a Kyiv resident said: “They refuse to come if there's a military checkpoint nearby.” As a result, many draft age men opt for remote work or stop working altogether in order to evade mobilization.

The Association of International Road Carriers complained of cases involving truck drivers being picked off the road and delivered to the territorial enlistment offices of the Armed Forces of Ukraine.

Kyiv is also struggling with an acute shortage of public transport drivers, which endangers the operations of transportation companies. In Kyiv's metro, the shortage of workers has been so acute that the enterprise was forced to increase the intervals between trains.

A growing share of women

To bridge the gaps in human resources, employers have been hiring more and more women to fill positions that were typically staffed by male applicants. Construction and extractive industries have seen an increase in the share of women in their ranks. In 2023, 1,200 women found jobs in the construction industry through the State Employment Service, which is 38% of the total number of all people employed in this area (in 2021, this figure was only 20%).

The same percentage secured employment in the extractive industries, where women accounted for nearly half (49%) of the year's hires (up from 27% in 2021).

The authorities have started paying attention to retraining programs for Ukrainian women. Women become bodyguards and learn to drive trucks, buses, and tractors. The Kharkiv metro has hired its first female electric train driver — Anastasia Mazurkova.

Kyiv's metro is also expecting its first female train drivers to complete their training shortly. Both cities are encouraging women to join the courses. The transition has not been smooth: job applicant Nino Nazarova shared that during her probationary period she had heard obnoxious speculation that a driving cab is no place for a woman and that some women “won’t even fit inside.”

The Ukrainian capital offers a variety of training courses for tram, trolley, and bus drivers. Western partners are also launching reskilling initiatives. The Swedish NGO Beredskapslyftet has set up a course to train women to drive trucks and buses.

The state began distributing training vouchers, providing citizens the opportunity to obtain a new profession at public expense. Professions typically marked by the domination of women — nurses, preschool teachers, healthcare workers, psychologists, cooks, and confectioners — are also popular. But women can choose from a wider range of options, including truck and tractor drivers. Over 10,000 Ukrainians have already obtained vouchers.

What happens after the war?

The problem of workforce shortages will hardly disappear even after the war ends, and they will likely hamper Ukraine's economic growth and infrastructure rebuilding efforts. Today, the country's entire labor market consists of 9 million people in official employment (as compared to 11.5 million before the war). However, ensuring robust economic growth and recovery would take at least 1.5 times as many. “According to preliminary estimates, in order to ensure annual GDP growth of 7% by 2030, we need an additional 4.5 million workers,” Berezhna admitted.

After the war, construction professionals, architects, and engineers will be among the most sought after specialists. Highly skilled workers such as welders, carpenters, and electricians will also be badly needed. Even more manpower will be needed in the law enforcement sector to maintain security. The country will see an increased demand for professions related to physical rehabilitation and mental health, as both military and civilian personnel will need to reintegrate into peaceful life.

Professionals in the fields of education and science, retail, agriculture, and marketing will also certainly come in handy. In particular, once the avenues for exports can be unblocked, logistics professionals will be needed to bring the industry back to pre-war levels.

To fill the labor market, Ukraine is preparing to work on putting future veterans and people with disabilities to work. “We're going to have about one million veterans who come back from the front and want to work. We will need to provide them with jobs or put them on permanent social assistance,” said First Deputy Minister of Social Policy Daryna Marchak. According to the Ministry of Social Policy, just over 450,000 out of 2.7 million people with disabilities are currently employed in Ukraine.

But the longer the war goes on, the harder it will be to bring back the millions who have left the country. “When Ukrainians start considering their return, they ask themselves: where will I live, where will I work?” Deputy Minister of Economy Oleksii Sobolev points out. Almost a third of refugees (31%) are not planning to go home even after victory, a 2024 poll showed. Another one-third (32%) still plan to return.

Some Western countries have already developed programs to compensate refugees who decide to return to Ukraine. In particular, Switzerland allocates $1,000-4,000 for every Ukrainian who decides to go home. In the Czech Republic, Ukrainians who want to leave the country before March 2025 (when temporary protection for Ukrainians ends) can also count on monetary assistance.

Of course, there can be no full recovery — and no full return even of those refugees who wish to come back home — until the war ends. Even if the government were to come up with a perfect solution for putting the country back to work, there is no telling when it might finally be possible to implement it.