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The Labor Market during the War in Ukraine

Author

Listed:
  • Andriy Tsapin

    (National Bank of Ukraine
    National University of Ostroh Academy)

  • Oleksandr Zholud

    (National Bank of Ukraine)

Abstract

This study analyzes the dynamics of the labor market in Ukraine during the full-scale russian invasion, emphasizing the need to account for profound structural changes in this market. We derive estimates of labor force participation and unemployment rates using survey data collected by Info Sapiens for the National Bank of Ukraine and controlling for sample composition. Participation fell by about nine percentage points between 2022 and 2025, while the unemployment rate peaked at 25 percent in May 2022 and gradually declined to 9 percent by December 2024. We corrected possible biases by including potentially omitted variables in our regressions. Regional and demographic disparities were pronounced during the war: Kyiv maintained lower unemployment, the east of the country was hardest hit, and the urban-rural gap narrowed after 2023. The gender gap in the labor market decreased but remained significant during the war. Education proved decisive for job retention, with university and vocational training significantly improving labor participation and employment outcomes. Our findings provide robust evidence of the adjustment of the labor market under extreme conditions and offer essential policy lessons for sustaining employment during the ongoing war.

Suggested Citation

  • Andriy Tsapin & Oleksandr Zholud, 2025. "The Labor Market during the War in Ukraine," Working Papers 04/2025, National Bank of Ukraine.
    • Handle: RePEc:ukb:wpaper:04/2025
    DOI: 10.26531/vnbu2025.wp04
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    Keywords

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    JEL classification:

    • H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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