Ukraine’s labour market in wartime: research by the EBA
The European Business Association together with a labour market analyst Tetiana Pashkinaconducted a labour market study to identify the main wartime trends, new HR policies, planned changes in the context of salary increases/cuts for 2023, efficiency under martial law, etc. We have divided the results of the survey into several blocks that you can read below. The study also divided the respondent groups into HR managers and other employees to understand whether the results differ.
Regarding personnel changes, HR professionals noted that in 2022 their companies experienced the following major changes:
- 50% of respondents reported an increase in salaries
- 39% of participants reported freezing budgets for staff development, training and retention
- 26% of participants reported the increase in functionality and hiring of new employees
- 21% reported staff cuts
- 11% reported freezing bonuses and bonus payments
- 7% reported a decrease in salaries
Representatives of other industries also stated that their companies had increased salaries (37%) and frozen budgets for staff development, training, and retention (43%). Besides, 34% of respondents said that their companies had reduced staff, but 32% of respondents said that their companies had increased functionality and hired new employees. Almost 20% of respondents indicated that bonuses and extra payments were frozen, and only 6% indicated a reduction in salaries as the main change in the company.
Support of employees in 2022
The majority of respondents (HR and other areas) said that their company helped employees in one way or another in 2022. Thus, HR representatives confirmed that the company paid salaries in full (89% of respondents), paid bonuses and extra payments (78%), and provided psychological support to employees (65%). Besides, the company compensated the costs of living of employees in another city/country (as reported by 39% of respondents), compensated part of the cost of renting accommodation (38%), and organized educational courses and programs. Among other support measures, it was noted that the company paid taxes for employees living abroad and opened international health insurance programs for employees.
Non-HR employees had similar answers. For example, 94% of respondents said that the company paid salaries in full, 74% paid bonuses and extra payments (, 42% paid for accommodation in another city, 36% compensated for part of the cost of housing, etc.
Positive changes for companies in 2022
HR representatives and employees of other areas reported positive changes for their companies in 2022, namely: improvement and strengthening of corporate culture and increase in eNPS, improvement of internal communication, increase in the level of care for employees, increase in business sustainability and flexibility, the opening of divisions in the western regions of Ukraine and scaling of business abroad, employees began to communicate exclusively in Ukrainian, further unification and cohesion of teams, increased engagement, increased exports of services, optimization of work processes, and creation of new business areas. Also, there was a transition from Russia to Europe in terms of subordination and/or a complete withdrawal of business from Russia. Some companies have set up a fund to support employees in need of financial assistance (loss, destruction of housing, injury).
Also, 60% of the survey participants noted that their companies have the opportunity to work remotely, but not for all categories of employees, 35% of respondents wrote that remote work is possible for all employees, and only 5% of participants wrote that their companies do not have the opportunity to work remotely.
What HR changes are planned for 2023?
HR participants of the survey noted that companies are planning such changes in 2023:
- An increase in the level of salaries;
- An entry into other markets and a search for new partners;
- Increased budgets for training and development;
- An increase in the number of employees;
- An emphasis on the multifunctionality of employees with a reduction in the size of staff.
Employees abroad
44% of HR respondents reported that the number of employees currently working and living abroad does not exceed 5%, 15% indicated the number of employees abroad ranges from 5 to 10%, 14% indicated the number of 10-15%, 19% reported that this number exceeds 15%. It is also important to note that 15% of respondents wrote that all employees of the company currently live and work in Ukraine.
As for the answers of employees in other sectors: 27% of respondents indicated that the number of employees currently working and living abroad does not exceed 5%, another 27% indicated the figure of 5 to 10%, 13% said the figure was from 10 to 15%, and 17% indicated the figure was more than 15%. At the same time, 22% of respondents say that all of their employees work in Ukraine.
The most popular countries for the relocation of employees are the following: Poland, Germany, Croatia, the Czech Republic, Romania, the United Kingdom, Spain, the Netherlands, Slovenia, Austria, Norway, Belgium, the United States, and Switzerland.
Plans to open new vacancies, expand the staff size, and raise salaries
More than 75% of the participants wrote that their companies do not plan to cut staff. In those companies where staff cuts are likely to take place, the percentage of reductions varies from 5 to 10%.
It is important to note that 33% of HR professionals noted that their companies plan to increase salaries by 15-20% (58% indicated an increase of 5-15%).
Efficiency, job change and new skills
We also asked employees how they assess their efficiency and performance under martial law. Thus, 37% of HR specialists noted that their level of efficiency has not changed under martial law, and 16% believe that they have started working better. However, 27% said they were in a state of burnout and 4% said they had started working worse. It is interesting to note that representatives across areas have slightly different results: 24% said that their level of efficiency had not changed under martial law, 31% said they had started working better, but at the same time, the same percentage of specialists said they were in a state of burnout, and 8% of specialists started working worse.
However, 73% of HR representatives and 65% of representatives from other areas do not plan to change jobs at this stage.
Among the skills acquired in 2022 (which will be required in 2023-2024), HR representatives emphasized the following skills: crisis management and change management, stress resistance and resilience, flexibility and adaptability, ability to work remotely, cohesion, ability to enjoy life, emotional intelligence, quick decision-making, ability to work in conditions of uncertainty, critical thinking, ability to learn quickly and ability to help those around you (first aid and psychological assistance), creativity, psychological resilience, teamwork, perseverance, cooperation with other colleagues or partners, willingness to relearn, dedication, courage, ability to take responsibility, proactivity, time management, tolerance, cross-cultural communication, focus on globalization, restoration of internal resources.
Representatives of other areas of activity additionally emphasized the ability to survive in war, indifference and neutrality, multitasking, and responsible leadership.
For reference:
The study was conducted from February 8 to 19, 2023. Participation in the study was anonymous. A total of 121 specialists took part in the survey: 70 HR specialists (46% department heads, 26% middle managers, 24% top management, 4% junior staff) and 51 specialists from other areas (35% middle managers, 34% top management, 27% department heads, 4% junior staff).
More than 60% of the participants in this study represent the international business. 47% of companies are large businesses, 45% are medium-sized businesses, and 8% are small businesses.
The majority of survey participants represent the pharmaceutical sector, specialized consulting services (legal, audit, marketing, recruiting, etc.), food production, non-food consumer goods production, wholesale/retail trade, and financial services (insurance, banking, securities).
