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Research on the labour market in Ukraine

23/ 05/ 2022
  The European Business Association in partnership with the magazine Personnel Management conducted a study of the labour market in Ukraine. Most of the companies participating in this study are international ones (54%) and have been operating in the Ukrainian market for more than 20 years (51% of companies). In terms of size, 46% of companies are large, 44% are medium, and 10% are small businesses. The majority of survey participants represent the sector of wholesale/retail trade in industrial goods (15%), 11% represent the consulting sector (legal, auditing, marketing, etc.), 10% represent financial services, 7% represent the agricultural sector, pharmaceutical sector, IT sector, logistics and infrastructure, 6% – wholesale/retail trade in food, 5% – construction, food production, 4% – production of consumer goods, 2% – fuel and energy, 1% – production of industrial goods, metallurgy. Regarding the changes that companies experience during martial law 76% of companies said that their company underwent changes during the martial law, which affect HR decisions. Among the changes are optimization of business lines (23%), relocation (16%), reorganization (12%), declared idle period (10%), suspension for an indefinite period (8%), closure of branches, and outlets (7%). It is important to note that 18% of companies do not plan any changes at all, and none of the companies participating in the study plan to close the company. However, it should be added that 74% of companies are planning changes in staff. 26% of companies plan to freeze budgets for development training, 16% will freeze bonuses, 13% will reduce staff, 11% will cut wages, 2% will resort to dismissal, and only 3% of companies plan to increase the number of employees. Regarding the changes planned for HR specialists, the survey demonstrates the following data: 59% of companies have retained their functions completely and HR specialists continue to work. Meanwhile, at 8% of companies, only those HR specialists, who provide documentary support for labor relations and recruitment, continue to work, others are offered different employment;  8% reduce the number of HR specialists, 7% redistribute functions; 7% of companies retain their HR team in full but some employees are temporarily transferred to other positions and perform other tasks; 6% did not fire their HR specialists, they continue to receive financial assistance from the company, but the staff is not involved in work processes; 5% of companies are looking for temporary work abroad for their HR staff. Regarding the relocation abroad Due to the martial law in Ukraine, 96% of companies have some of their workers relocated abroad. Thus, 23% of companies reported that the share of relocated employees varies from 11% to 15%; 17% of companies have the share varies from 16% to 20%. Another 17% of companies said that the number of employees who relocated abroad is 21% -30%. The most popular countries for relocation are Poland (87%), Germany (62%), the Czech Republic (48%), Slovakia (35%), Italy (31%), Romania (28%), Spain and Hungary (27%), Moldova (17%). 65% of companies said that their company does not plan to relocate to another country, and 15% of companies may relocate within Ukraine. Those companies, that plan the relocation to another country, consider Poland, Slovakia, Hungary, Spain, Romania, and others as the options. The majority of companies (56%) report that employees, who received temporary protection in the EU, do not work for other companies abroad and continue to work for their company remotely and receive a salary. However, there are 25% of companies where employees have found work abroad, but also continue to work for their company remotely. Also, 8% of companies reported they asked colleagues, who found work abroad but did not want to terminate their employment with the Ukrainian company, to write applications for unpaid leave for an agreed period. There are 3% of companies reporting that employees, with temporary protection in the EU, will be paid financial assistance for a certain period. It is important to note that 94% of companies indicated that their company helps employees in wartime. 76% of companies pay full wages, 52% provide psychological support, 48% help with relocation to another city/country, 35% cover the costs of living in another city, 34% pay bonuses, 32% reimburse part of the cost of rent, 17 % organize training courses. Changes in the number of employees 2022 On the positive side, 78% of companies do not plan to reduce their staff in 2022. Besides, 76% of companies answered that they did not reduce wages.  Among those companies that plan to reduce staff 22% plan to reduce the number of staff: 12% of companies –  by 5%; 12% of companies – up to 10%; 31% – by 11%; 12% of companies –  by 30% - 39% and 19% of companies by 20% - 29%. However, 23% of companies plan to open new vacancies in 2022 and another 8% of companies will open vacancies for Ukrainian candidates. It is known that 30% of companies do not plan to open vacancies in 2022 and 39% of companies have not yet decided on this issue. Regarding CEO internal & external communication 38% of companies said that their employees are actively involved by openly discussing and asking questions about relocation, reorganization of the company. In 31% of companies, business issues are discussed only at the management level, in 18% of companies there is no such practice at all, in 8% of companies employees are not involved and implement the decisions made by management. It is important to note that 45% of employees are very satisfied with the level of external communication of the companys management during martial law, 28% of employees are partially satisfied, 20% of employees say that management still has work to do and only 6% of employees are dissatisfied with the level of communication. Typically, CEOs communicate quite effectively with employees about changes that affect HR management policies during martial law. Thus, 23% communicate with the heads of structural units, who then convey information to subordinates, 20% hold online meetings where each employee can ask the CEO questions, in 17% of companies each employee can appeal directly to the CEOs with the issue important for him/her, 15% of managers communicate in messengers, and 9% publish video addresses weekly. In another 15% of companies, the HR director leads the communication. DOWNLOAD THE SURVEY REPORT For reference: The study was conducted in February-April 2022. The purpose of this study is to identify major trends in the labour market during martial law. The study lasted from April 18 to April 30, 2022. Altogether, 71 HR specialists participated in this study anonymously.

The European Business Association in partnership with the magazine “Personnel Management” conducted a study of the labour market in Ukraine. Most of the companies participating in this study are international ones (54%) and have been operating in the Ukrainian market for more than 20 years (51% of companies). In terms of size, 46% of companies are large, 44% are medium, and 10% are small businesses.

The majority of survey participants represent the sector of wholesale/retail trade in industrial goods (15%), 11% represent the consulting sector (legal, auditing, marketing, etc.), 10% represent financial services, 7% represent the agricultural sector, pharmaceutical sector, IT sector, logistics and infrastructure, 6% – wholesale/retail trade in food, 5% – construction, food production, 4% – production of consumer goods, 2% – fuel and energy, 1% – production of industrial goods, metallurgy.

Regarding the changes that companies experience during martial law

76% of companies said that their company underwent changes during the martial law, which affect HR decisions. Among the changes are optimization of business lines (23%), relocation (16%), reorganization (12%), declared idle period (10%), suspension for an indefinite period (8%), closure of branches, and outlets (7%). It is important to note that 18% of companies do not plan any changes at all, and none of the companies participating in the study plan to close the company.

However, it should be added that 74% of companies are planning changes in staff. 26% of companies plan to freeze budgets for development training, 16% will freeze bonuses, 13% will reduce staff, 11% will cut wages, 2% will resort to dismissal, and only 3% of companies plan to increase the number of employees.

Regarding the changes planned for HR specialists, the survey demonstrates the following data: 59% of companies have retained their functions completely and HR specialists continue to work. Meanwhile, at 8% of companies, only those HR specialists, who provide documentary support for labor relations and recruitment, continue to work, others are offered different employment;  8% reduce the number of HR specialists, 7% redistribute functions; 7% of companies retain their HR team in full but some employees are temporarily transferred to other positions and perform other tasks; 6% did not fire their HR specialists, they continue to receive financial assistance from the company, but the staff is not involved in work processes; 5% of companies are looking for temporary work abroad for their HR staff.

Regarding the relocation abroad

Due to the martial law in Ukraine, 96% of companies have some of their workers relocated abroad. Thus, 23% of companies reported that the share of relocated employees varies from 11% to 15%; 17% of companies have the share varies from 16% to 20%. Another 17% of companies said that the number of employees who relocated abroad is 21% -30%. The most popular countries for relocation are Poland (87%), Germany (62%), the Czech Republic (48%), Slovakia (35%), Italy (31%), Romania (28%), Spain and Hungary (27%), Moldova (17%).

65% of companies said that their company does not plan to relocate to another country, and 15% of companies may relocate within Ukraine. Those companies, that plan the relocation to another country, consider Poland, Slovakia, Hungary, Spain, Romania, and others as the options.

The majority of companies (56%) report that employees, who received temporary protection in the EU, do not work for other companies abroad and continue to work for their company remotely and receive a salary. However, there are 25% of companies where employees have found work abroad, but also continue to work for their company remotely. Also, 8% of companies reported they asked colleagues, who found work abroad but did not want to terminate their employment with the Ukrainian company, to write applications for unpaid leave for an agreed period. There are 3% of companies reporting that employees, with temporary protection in the EU, will be paid financial assistance for a certain period.

It is important to note that 94% of companies indicated that their company helps employees in wartime. 76% of companies pay full wages, 52% provide psychological support, 48% help with relocation to another city/country, 35% cover the costs of living in another city, 34% pay bonuses, 32% reimburse part of the cost of rent, 17 % organize training courses.

Changes in the number of employees 2022

On the positive side, 78% of companies do not plan to reduce their staff in 2022. Besides, 76% of companies answered that they did not reduce wages.

 Among those companies that plan to reduce staff 22% plan to reduce the number of staff: 12% of companies –  by 5%; 12% of companies – up to 10%; 31% – by 11%; 12% of companies –  by 30% – 39% and 19% of companies by 20% – 29%.

However, 23% of companies plan to open new vacancies in 2022 and another 8% of companies will open vacancies for Ukrainian candidates.

It is known that 30% of companies do not plan to open vacancies in 2022 and 39% of companies have not yet decided on this issue.

Regarding CEO internal & external communication

38% of companies said that their employees are actively involved by openly discussing and asking questions about relocation, reorganization of the company. In 31% of companies, business issues are discussed only at the management level, in 18% of companies there is no such practice at all, in 8% of companies employees are not involved and implement the decisions made by management. It is important to note that 45% of employees are very satisfied with the level of external communication of the company’s management during martial law, 28% of employees are partially satisfied, 20% of employees say that management still has work to do and only 6% of employees are dissatisfied with the level of communication.

Typically, CEOs communicate quite effectively with employees about changes that affect HR management policies during martial law. Thus, 23% communicate with the heads of structural units, who then convey information to subordinates, 20% hold online meetings where each employee can ask the CEO questions, in 17% of companies each employee can appeal directly to the CEOs with the issue important for him/her, 15% of managers communicate in messengers, and 9% publish video addresses weekly. In another 15% of companies, the HR director leads the communication.

DOWNLOAD THE SURVEY REPORT

For reference:

The study was conducted in February-April 2022. The purpose of this study is to identify major trends in the labour market during martial law. The study lasted from April 18 to April 30, 2022. Altogether, 71 HR specialists participated in this study anonymously.

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