Income of Ukrainians in the fall of 2023: why they receive less than is necessary for a normal life

The average salary in Ukraine is gradually growing, although it is still the same “average temperature in a hospital”: not everyone is paid well everywhere, and not everyone. In addition, experts say, an interesting trend has emerged: full-time work and “white” income have ceased to be absolute advantages. How are Ukrainians paid now and are companies ready to pay specialists more?

In 2023, salaries in Ukraine are gradually moving up, but the expenses of Ukrainians due to inflation and other factors are increasing. Now, for a normal life, Ukrainians need on average 12,750 UAH per month per person. This is stated in the Sociological Monitoring “Ukrainian Society”, conducted by the Kyiv International Institute of Sociology on behalf of the Institute of Sociology of the National Academy of Sciences of Ukraine.

When asked how close current income is to the amount they indicated, 43.5% of respondents noted that they were significantly lower, 25.8% - somewhat lower. Every fourth to fifth person (21.9%) indicated that they earn approximately as much as they need, and 8.9% are among the lucky ones whose incomes are higher than the specified amounts.

Focus found out what is happening in the labor market now, who is offered the highest salaries, why difficult times have come for IT specialists, and what awaits the Ukrainian labor market.

Ukrainians' money: salaries are growing, but incomes are not very good

According to the personnel portal work.ua, in the last month of summer the average salary in Ukraine increased to 17.5 thousand UAH. And according to the portal robota.ua, the average salary for vacancies over the last three months was 15.3 thousand UAH, for resumes - 15 thousand UAH. It would seem that the amounts are significantly higher than those named by respondents to the KIIS study when talking about “normal life,” but not everything is so simple.

How do Ukrainians assess their family’s needs for money?

Firstly, this is a salary, not income per person. But most families still have children, pensioners, and the unemployed, so if you divide the salaries of workers among everyone, the income will be significantly less.

Secondly, the average salary is like the average temperature in a hospital: in some places it’s crowded, and in others it’s empty. According to work.ua, wages increased the most in August in the Kyiv, Lviv and Odessa regions. If we talk about categories, then these are, first of all, “Top management, senior management”, “Real estate”, “Transport, auto business”, “Media, publishing, printing”, “Jurisprudence”.

Do Ukrainians earn enough money to provide for themselves and their families?

Consistently among the best-paid positions are IT specialists (salaries, depending on the field, range from 27.2 to 80 thousand UAH), international drivers (42.5 thousand UAH), realtors (35 thousand UAH), as well as auto electricians and auto mechanics , drillers, chief engineers (30 thousand UAH). But among the least paid positions with salaries from 6.7 thousand to 11 thousand UAH were concierge, orderly, cleaner, dishwasher, veterinary assistant, distribution line worker.

Leaders and outsiders: how the labor market is recovering

This year, the Ukrainian labor market began a new stage of recovery without waiting for autumn. Already in August, records were set for the number of vacancies and wages. Let's give some statistics. According to work.ua, in August employers published more than 100 thousand vacancies.

The top five regions in terms of the number of jobs offered remain unchanged:

• Kyiv (33,283 vacancies).
• Dnepropetrovsk (9,831).
• Lvovskaya (9,705).
• Odessa (6,927).
• Kharkovskaya (3,732).

In addition, the Kiev region was among the leaders in growth (+11% compared to July) together with Khmelnitsky (+12%), Rivne (+16%), Zhytomyr (+27%) and Chernigov (+29%).

Ukrainians are now primarily provided with work in the following sectors:

• “Service sector” (19,449 vacancies).
• “Workers specialties, production” (18,853).
• “Sales, purchases” (13,449).
• “Retail trade” (12,497).
• “Hotel and restaurant business, tourism” (10,861).
• “Logistics, warehouse, foreign trade activities” (10,179).

Many offers in August were associated with the beginning of the new school year: employers were looking for mathematics and foreign language teachers, primary school teachers, special education teachers and educators. In absolute numbers, the most in-demand specialists were sales consultants (8,591), sales managers (6,608), drivers (3,504), cooks (3,447) and accountants (3,334).

A wide selection of vacancies allows job seekers to choose and set their own conditions in the labor market. In turn, recruiters have to make efforts to attract the best candidates. Therefore, employers respond to this by increasing offers for applicants without experience, veterans, people with disabilities, students, and retirees. In addition, companies are trying to provide workers with something more than just a stable income. According to robota.ua, in addition to salaries, companies offer employees bonuses and premiums (23%), free training (16%), regular salary reviews (11%), corporate events (11%), employee discounts (11%) and offices with generator (6%).

Employers are responding to the personnel shortage by increasing offers for applicants without experience, veterans, people with disabilities, students, and retirees.

An interesting point: the general trend of “fighting for employees” did not affect IT specialists. For the position of Java and Javascript programmer, Python programmer, tester, UI/UX designer and Front-end developer, the competition for applicants is tens of times higher than the market average.

This is quite strange, especially if you remember that the IT sector was the only industry that grew during 2022. However, experts explain: in 2022, IT specialists were finalizing contracts signed before the full-scale war. But today foreign clients are in no hurry to enter into new contracts for a variety of reasons: the global recession (last year many international companies laid off tens of thousands of employees, so the general trend points to a shrinking labor market), the risk of blackouts, difficulties with booking employees, the lack of a real mechanism even short-term business trips abroad.

These factors prevent the IT sector from operating at pre-war levels. Which means a fairly large number of “free” IT specialists looking for a stable income within Ukraine.

Trends in the new labor market in Ukraine: they want to be self-employed entrepreneurs and work from home

Director of the consulting company “Mikhailov and Partners” Vitaly Mikhailov says that 100 thousand vacancies on leading personnel portals are very large numbers. For comparison: at the height of the coronavirus there were only 35 thousand, and in March 2022 there were about 6 thousand.

“100 thousand is the pre-war level. And if we take into account the temporarily occupied territories, which are not included in the statistics, and the business relocated to other countries, it becomes clear that the pre-war 100 thousand and the current ones are different things. Now the personnel shortage is worse,” Mikhailov noted in a commentary

However, almost everyone who is looking for a job today experiences an unpleasant paradox: there are many vacancies, but it is quite difficult to get a job. Supply and demand, unfortunately, do not coincide.

“There has always been such a discrepancy - and before the war it took months to find a good job. Now such imbalances have become even greater, and this is especially true for qualified narrow specialists, white collar workers. Firstly, this is due to the war: women went abroad, men went to the front. The market for potential job applicants has dropped by millions, and there is a reallocation of labor. Therefore, it is becoming increasingly difficult for employers and employees to find each other. Secondly, global trends related to automation and robotization influence. Business is moving online, everything is moving in a “contactless” direction, instead of operators and specialists, chatbots are already working in many places. With working specialties everything is simpler. In Ukraine, the demand for workers who can build and restore is only growing, and such work is much easier to find,” says Vitaly Mikhailov.

If we talk about the main trends in the Ukrainian labor market, then, according to Yuri Gorokhovsky, General Director of ESCADRA Recruitment Agency Ltd, there are several of them now.

“To begin with, today candidates who have jobs do not want to consider new offers, trying to achieve stability at least in this. There is a complete unpreparedness for relocation within Ukraine - the vast majority do not even want to hear about moving to another city for a higher salary. This is not to mention the fact that now the best work, wherever possible, is considered remote. Ukrainians are so accustomed to remote work that a full day in the office is perceived as some kind of “heavenly punishment.” Among the “military” trends, there is this: if previously working in the state and a white salary were advantages, now men want neither one nor the other. Everyone is trying to be a sole proprietor so that the military registration and enlistment office won’t find them. Therefore, if you hear the latest news about a record growth in the number of individual entrepreneurs in Ukraine, keep in mind that this most likely does not affect the opening of new businesses,” Gorokhovsky told Focus.

Forecasts for the future: salaries will rise, but a “return program” is needed

According to a survey conducted by the European Business Association (EBA), in 2024 the vast majority of Ukrainian companies (87%) will increase wages for their employees. Of these, almost half (46%) plan to increase to 10%, and 41% - from 10% to 20%. Only every hundredth company will reduce wages, 12% plan to leave employee salaries unchanged.

Until the end of 2023, the number of vacancies will increase, and salaries will continue to rise - at least at the rate of inflation

Compared to last year, the number of companies planning to introduce new investment projects has increased - from 19% to 26%. The average cost of planned projects has also increased and is about $8 million (in 2023 - $3 million). The number of companies planning to invest in social initiatives has also increased slightly, from 60% to 65%. On average, according to the EBA, businesses are ready to allocate about 6% of company income to social projects.

“Business is gradually recovering, investing and making plans, which means they believe in a better future for Ukraine and our victory. Moreover, it brings it closer in every possible way and places great emphasis on social initiatives,” commented Anna Derevyanko, executive director of the European Business Association, on the survey results.

Yuri Gorokhovsky agrees with the EBA’s conclusions: by the end of 2023, the number of vacancies will increase, and wages will indeed continue to grow - at least at the rate of inflation. And Vitaly Mikhailov adds: when there is such competition for employees, the employer is simply forced to pay more.

The shortage of young specialists is already acutely felt in the market, in particular due to the migration of young people abroad

“Salaries are still growing - they have already reached the pre-war level in hryvnia,” says the expert. “In dollar terms, due to the devaluation of the national currency, earnings have dropped, so there is room to move.”

As for the long term, Vitaly Mikhailov believes that the labor market will have to solve several serious problems. Firstly, this is the retraining of people who have lost their jobs due to the fact that their companies and production facilities have physically ceased to exist. Such specialists will have to master new professions and find themselves in new conditions.

Secondly, this is the adaptation of people who returned from the front with shell shock and disability. Many of them will not be physically able to work in their old workplace, but these people should not feel “superfluous”. Thirdly, there is a huge shortage of young specialists due to the fact that children and teenagers have left the country.

“The longer children live and study in other countries, the more deeply they integrate and the lower the likelihood of them returning. They learn a new language and, most likely, will go to study at local schools and universities, and then enter the local labor market. If Ukraine doesn’t come up with some kind of “super program” to bring millions of Ukrainians back, this will become a real disaster for our economy,” concluded Vitaly Mikhailov.