Labor shortages drive up wages in Ukraine, central bank says

Ukrainian companies are forced to offer higher wages as they are faced with increasing labor shortages, according to a report by the National Bank of Ukraine (NBU) published on July 4.

Over 6 million Ukrainians left or were forced out of their home country after the outbreak of Russia’s full-scale war, according to UNHCR.

The labor shortage is compounded by the intensifying mobilization drive as Kyiv seeks to replenish the ranks of its Armed Forces. Many sectors have been seeking exemptions from the draft for their employees.

According to the NBU’s report, the offered monthly salaries have continuously grown from around Hr 13,500 ($332) in February 2022 to roughly Hr 19,500 ($480) in May 2024.

Requested salaries have also increased from Hr 15,500 ($380) in February 2022 to 20,500 ($505) in May this year.

Concurrently, the index of difficulty in finding a workforce increased from 5 points to 35 for unskilled labor and from almost 20 points to 40 for skilled labor between the start of 2023 and May 2024.

“Businesses will continue to experience labor shortages, which will drive higher wages in the private sector,” the report read.

“Together with rising social benefits and low inflation, this will contribute to the growth of the population’s real incomes.”

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