In Ukraine, the war is depleting businesses of their workforce
In Ukraine, the war is depleting businesses of their workforce: «I never know if my employee will come to work tomorrow».
From tech SMEs to large industrial companies, shortages affect all sectors. Business leaders complain about uncertainty linked to mobilization.
A third fewer assets
Behind the individual tragedies, the Ukrainian economy is bloodless. Nearly 60% of companies are short of labor due to mobilization, but also departures abroad. «One-third of Ukraine’s 11 million pre-war workforce is no longer working, according to the Ministry of Social Policy. «We estimate that around 1.5 million working women left the country in 2022 and around the same number of men were drafted, killed in combat or emigrated, legally or not», reports Hlib Vyshlinsky, director from the Ukrainian think tank Center for Economic Strategy. The initial drop in activity and westward migration somewhat alleviated the labor shortage. However, the subsequent lack of male labor became the main challenge for the Ukrainian economy, as much or more than the bombings or power cuts, estimates the economist. Located about a hundred kilometers from the front line on the Dnipro River, the Arcelor Mittal steel works was idle until 2023.
The mobilization affects all men aged 18 to 60. The labor shortage is felt in all sectors, even more so since the start of 2024 and the new wave of mobilization. There is a shortage of arms everywhere. In the streets of Kyiv, a number of small posters have appeared: «Looking for a seller», «Need a cook», «Seeking an administrator». As a result of the shortage, the average salary increased by 22.5% in the first quarter of 2024 compared to the same period in 2023. The government estimates that it will even increase from 19,000 (441 euros) to 21,800 hryvnias (506 euros) by the end of this year. The shortage is even more difficult to manage for small businesses.
Pay to avoid mobilization
Faced with a manpower shortage, Kyiv had already drawn up a list of strategic companies, which can reserve up to 50% of their employees for mobilization. However, the system remains complex and bureaucratic, often immediately excluding SMEs with low turnover. Despite his work on war crimes, Yuri does not fit the criteria. Kateryna has reserved half of her employees, the maximum possible, even if it is not enough to work at full capacity and the procedure does not always work. «If the employee has even a small irregularity in his file, he must go to the recruitment center. And there, as he does not yet have an exemption, he is immediately mobilized», explains Hlib Vyshlinsky.
Source: Le Figaro.
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