According to the latest Inflation Report from the National Bank of Ukraine (NBU), both labor demand and supply increased compared to the same period last year, resulting in a historic rise in the share of employed citizens during the full-scale invasion.
Labor Market Trends in Early 2025
The NBU highlights that in Q1 2025:
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The number of vacancies and resumes grew compared to Q1 2024.
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Enterprises intensified efforts to attract students, pensioners, people with disabilities, and veterans into the labor force.
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As a result, the share of unemployed citizens decreased, while the employment rate rose to its highest level since the start of the Great War.
Despite these positive shifts, the shortage of skilled labor remains significant due to ongoing challenges such as migration, mobilization, and imbalances in the labor market.
Impact on Wages and Inflation
The persistent personnel shortage continues to stimulate:
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Wage growth across various sectors
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Higher household incomes
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Stronger aggregate demand
The NBU warns that this trend will have a pro-inflationary effect throughout 2025, as rising wages in the private sector will continue to outpace broader economic adjustments.
Migration Outlook
Earlier forecasts from the NBU indicated that:
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In 2025, a net outflow of about 200,000 Ukrainians is expected.
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In 2026, a net return of 200,000 citizens is projected.
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In 2027, 500,000 Ukrainians are expected to return, accelerating workforce recovery.
