Ukraine may lose a million workers by 2030: experts warn of critical staff shortage

By the end of 2030, the civilian workforce in Ukraine could shrink by a million people — from 12.9 to 11.9 million. Even the return of Ukrainians from abroad and the employment of demobilized military personnel will not be able to fully compensate for the shortage of workers. This situation could become one of the main challenges for the country’s economic recovery.

The number of workers will decrease by 8% by 2030

According to analysts’ forecasts, Ukraine will continue to lose labor resources in the coming years.

In the baseline scenario, the civilian workforce will decrease by approximately 8% — from 12.9 million to 11.9 million people.

This means that Ukrainian enterprises will have to work in conditions of an increasingly acute shortage of personnel.

To compensate for the reduction in the number of workers and achieve the projected economic indicators, labor productivity in 2027–2029 should grow by an average of 5.1% each year.

This is 2.6 times faster than in the period 2011–2021.

Ukraine’s population could shrink to 22 million

The researchers also developed three scenarios for Ukraine’s demographic development.

According to their estimates, by the beginning of 2041 the population in the territory covered by the study could be:

26.7 million people — in the optimistic scenario;

25 million people — in the moderate scenario;

22.3 million people — in the pessimistic scenario.

In all three cases, further population decline is predicted.

The main reason will be the excess of mortality over birth rate.

In addition, Ukraine will face an aging population: the share of older people will increase, while the number of potential workers will decrease.

Under the moderate scenario, the number of people aged 15 to 64 will decrease from 19.6 million in 2026 to 16.4 million in 2040.

Will the return of Ukrainians from abroad help

One of the key factors that will affect the labor market remains migration.

The KSE Institute’s baseline forecast is based on the assumption that the war will end at the end of 2027.

Under this scenario, approximately a third of citizens who left due to a full-scale invasion could return to Ukraine over the next 13 years.

By the end of 2030, the return of Ukrainians could increase the civilian labor force by approximately 500,000 people.

However, even this will not be enough to fully compensate for the reduction in labor resources.

Analysts have estimated that out of 100 Ukrainians who return to the country by the end of 2030, only about 46 will be working or actively looking for work.

Return of veterans may affect the shortage of personnel

An important role in the restoration of the labor market will be played by the employment of veterans after demobilization.

According to researchers, the difference between the rapid and slow integration of veterans into civilian life may be approximately 200 thousand people in the labor force by the end of 2030.

This means that the availability of retraining, professional adaptation and employment programs will be of significant importance for the economy.

At the same time, analysts emphasize that even with a favorable development of events, the shortage of workers will remain a serious problem.

Three scenarios for the Ukrainian labor market

KSE Institute considers several possible scenarios for the development of the situation by the end of 2030.

Favorable scenario — 12.2 million people.

Assumes the return of half of Ukrainians who left due to the war within 13 years and the rapid integration of veterans into the civilian labor market.

Baseline scenario — 11.9 million people.

Assumes a moderate pace of return of citizens and a gradual restoration of labor resources.

Unfavorable scenario — 11.5 million people.

Can be realized if only 15% of Ukrainians who left abroad return within 13 years, and the process of employment of veterans proceeds slowly.

Thus, the difference between the most favorable and unfavorable scenarios is about 700 thousand workers.

What consequences will this have for the Ukrainian economy

Reducing the number of workers can become a serious obstacle to economic recovery after the war.

The shortage of personnel will complicate the work of enterprises, the expansion of production and the implementation of investment projects.

Under such conditions, increasing labor productivity will be of particular importance.

Enterprises will have to provide greater volumes of production and services with fewer employees.

However, the required productivity growth rates significantly exceed the indicators that the Ukrainian economy has demonstrated in previous years.