The increase in demand for labor in Ukraine continues to push the level of salaries to new heights. According to the National Bank of Ukraine (NBU), in the second quarter of 2024, real wages increased by 17.6% compared to the same period of the previous year, while nominal wages increased by 22.1%. The main reason for this growth is the acute shortage of personnel, which creates high competition between employers.

According to information from the inflation report of the NBU for October, the growth dynamics of nominal wages remained high in the third quarter as well, although rising inflation somewhat reduced the real purchasing power of incomes. Despite this, the high level of salaries contributed to the support of private consumption, which, in turn, had a positive effect on economic activity in the country.

NBU experts predict that by the end of the current year, real wages in Ukraine will exceed the pre-war level. Labor shortages remain a strong driver of wage growth as employers continue to compete for a limited supply of skilled workers. At the same time, the unemployment rate is gradually decreasing, although it is still higher than before the start of the full-scale invasion.

The war caused significant disparities in the labor market. Many qualified personnel were forced to leave their jobs, and the return of demobilized military personnel to the usual labor process is long and difficult. In addition, some Ukrainians adapt to life abroad, which also limits the personnel potential in various regions and industries.

In the labor market, there is a high demand for labor specialties, as well as employees in the field of service and retail trade. Kyiv, Lviv and Dnipro became the leaders in the number of vacancies. Stabilization of the economy has allowed the level of employment to increase, and the number of new resumes has increased in recent months. NBU specialists see this as a sign of the return to the market of people who previously for various reasons did not work officially.

Despite the increase in the number of job seekers, the imbalance between demand and supply still persists, making it difficult for many businesses to operate. According to the study, the ratio of candidates to vacancies is currently lower than in 2021, indicating a significant labor shortage. Most companies do not plan a significant expansion of the staff, even despite optimistic forecasts for the next year, due to which the competition for personnel remains high.

A significant outflow of labor abroad in the third quarter also increased the pressure on the labor market. According to the UN, the number of Ukrainian migrants increased by almost 200,000 during this period, reaching 6.8 million by mid-October 2024. Migration outflow remains a significant risk for the economy, which makes it difficult to return to stability in the labor market and creates prerequisites for further wage growth.