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Expert commentary

Inadequate unemployment

22.08.2018 2016 became a turning point in the Ukrainian labor market. The number of vacancies has tripled when compared to 2015. In 2017, the trend remains, but its dynamics are significantly lower. Meanwhile, the State Statistics Service of Ukraine has published its data for the first quarter of this year. It turns out that unemployment in the country has grown up to 10.1%.

CASE Ukraine`s Executive Director Dmytro Boyarchuk commented to ‘Segodnya’ media outlet that the unemployment rates in our country do not always adequately reflect the reality.

‘Now we observe a strange situation. GDP has begun to grow (2.5% in the 1st quarter), and the unemployment situation has deteriorated. That should not be the case, – he notes. – It turns out that the economy in the first quarter, compared with the last year, lost 19.5 thousand jobs’.

According to the expert, the main blow fell on women: they lost 59.8 thousand jobs. The men, by contrast, received 40.3 thousand ones.

‘Doubling of the minimum wage is among the events that could directly affect the labor market. These are preliminary conclusions about the growth of unemployment against the backdrop of economic growth’, Boyarchuk says.

Official statistics claim unemployment rises. Nevertheless, the job search sites claim the number of vacancies grow, because they observe two parallel processes, the expert believes.

‘On the one hand, the economy is reviving, and there is a request for new employees. The vacancy websites fix that. On the other hand, the business adapts to new conditions (we suspect it is a new minimum wage) and fires unnecessary employees. The recruiting agencies do not fix it, – Boyarchuk explains. – That is, the recovery of the economy has not yet been able to create so many jobs to offset the negative effects of doubling the minimum wage’.