The number of responses of Ukrainians to open vacancies breaks all records and exceeds the pre-war level by five times. The explanation is simple – as a result of the war, many Ukrainians either lost their jobs or receive reduced salaries. Monthly income has fallen and prices have risen, so Ukrainians are actively looking for work or part-time work. At the same time, not all employers can pay pre-war wages. In almost all professional fields, the decline in wages continues. What can Ukrainians expect and when will the situation with salaries level off? Experts from the analytical center of the grc.ua recruitment portal presented their own forecast on this matter.
The labor market has passed the zero point of a complete collapse, when at the beginning of the war there were no new vacancies, no new resumes. The priority for both workers and companies was to ensure life. As of early June, those companies that could resume their commercial activities did so. However, there are far fewer jobs than those who want to get it. The labor market is in the state of the employer’s market. Employers also experienced the negative impact of the war. Part of the economy is still not working, the volume of commercial activity of a large proportion of companies has not returned to the previous level, so the business optimizes costs and often reduces wages for both existing and new employees.
The reduction in salaries does not always depend on the demand for professions. For example, sales, builders, transport specialists and workers are now among the most sought-after specialists, but the average salary level for them has also decreased.
Only a few professional areas have not yet been affected by the general downward trend. Among them are top management, agriculture, medicine and pharmaceuticals, marketing, advertising and PR. The war had almost no effect on wages in the IT sector. Given the rise in prices and the decrease in the purchasing power of Ukrainians, many are concerned about the questions: what will happen to wages? How long will their decline last? When can we expect the situation to level off and return to the usual income?
In conditions of uncertainty and an unstable economy, a return to the pre-war level of wages in all professional fields is not yet possible. The longer the war goes on, the more difficult it will be to restore both the commercial activity of the business and the economy as a whole. According to the most optimistic forecasts, the restoration of income to the pre-war level will last 3-5 years. This can be facilitated, firstly, by the return to Ukraine of qualified specialists who were forced to leave the country to escape the war, and secondly, financial assistance that foreign partners can provide to restore the Ukrainian economy.
True, the experience of overcoming the 2014 crisis showed that a quick return of salaries to previous figures is possible only in hryvnia. If we analyze the labor market crisis in 2014, positive stabilization and growth trends were recorded only in the first half of 2016. Most companies were able to raise salaries for their employees, more than a quarter of them increased compensation for everyone without exception, staff cuts stopped, and the labor market has fully recovered from the crisis. However, the labor market remained an employer’s market, and more stringent criteria for selecting candidates for a position were applied. Wages, although they increased, income remained lower than before the crisis, because there was a noticeable inflation. Approximation of salaries to the level of 2013 in dollar terms occurred only in 2019/2020, when the labor market fell into another crisis.
A conditionally positive moment is that further reduction of wages is not expected now. Business adapted to the new conditions of the war. Slowly, representatives of small and medium-sized businesses, which suffered the most from the war, are starting to return to work. Increasing jobs, increasing purchasing power, acquiring goods and services and, finally, revitalizing the circulation of funds will provide opportunities to stabilize the economy and keep wages at current levels.
