STOP THE FLOW: WHY UKRAINE MUST RETAIN ITS QUALIFIED PERSONNEL
Today, between three and six million Ukrainians work abroad, according to Deputy Prime Minister Pavel Rozenko. Research by Kyiv International Institute of Sociology shows that of those who plan to work in the European Union over the next six months, 35.6 percent will choose Poland, 12.5 percent will head to the Czech Republic, and 10.6 percent to Germany. Russia, which at one time led the pack in terms of Ukrainian labor migrants until 2014, has moved down to fourth place, with 7.1 percent considering a move eastward.
In the EU, available work for Ukrainians is based on manual labor, where the largest number of vacancies can be found in industry (food enterprises, chemical, cosmetics, etc.), as well as agriculture and construction. Poverty remains the trigger of labor migration from Ukraine, as, since Jan. 1, 2018, the minimum wage in Poland before taxes was set at PLN 2,100 PLN ( Hr 14,800). By the end of 20162017, Ukrainians in Poland were earning an average of PLN 1,826 PLN ( Hr 12,930) to PLN 2,800 ( Hr 19,830), depending on their qualifications. The average salary in Ukraine in April 2018 was only Hr 8,480. To explain the constant outflow of labor from Ukraine to the EU using poverty alone is a very dangerous delusion, however, and here’s why.
Both Poland and the Czech Republic are pursuing a purposeful policy to attract qualified Ukrainian labor resources. According to the Personnel Service Survey, 24 percent of Polish employers are willing to pay Ukrainians more than their fellow Polish citizens for manual labor. Their reason is that it remains difficult to attract qualified personnel in the domestic labor market. With this regard, in the Czech Republic the local government increased a quota for the reception of Ukrainians more than twice in 2018, which meant the number of jobs grew from just 9,600 to 19,600! Czech Foreign Minister Martin Stropnitski said that his country is simply reacting to a shortage of labor with the necessary skills.
According to the National Bank of Poland, Ukrainians have a very powerful influence on their economy, where more than 90 percent of money transfers out of country are made to Ukraine. This reality refutes the stereotype that Europe needs Ukrainians for little more than housework or the gathering of berries. Ukrainians have long since become a part of the global migration processes, which will only continue to grow in the near future. The question is, is Ukraine ready for this challenge?
Globalization has changed the structure of capital and investment, which means the modern world needs enterprising and qualified personnel. Countries that boast businesses that can create products with high added value through technology and innovation will break away from the pack. The United States and China are already competing for first place with regard to artificial intelligence. According to plans set forth by the State Council of China, this area should accumulate $150 billion by 2030, and adjacent to that $1.5 trillion. In practice, as an example, this means that lawyers of the future will not interact more with judges, but with computer systems, in which clear algorithms will be created. Those in the legal system should be ready to participate in court hearings thousands of kilometers away, and they will need to be consultants and advisors able to cooperate in international multidisciplinary teams who are also able to analyze risks and understand project management. If we need specialists at this level, we need to change our education and training systems now. While developed countries consider innovation and creativity to be highly valuable, our universities (and even the students themselves) are still being subjected to written lectures for which they receive the coveted checkmark.
To create comfortable conditions for a qualified workforce in Ukraine, the rule of law along with a transparent public administration are key. We have great resources: Ukraine’s own pharmacology options could replace 94 percent of imported medications, as an example. We also have everything to become a leading player in the EU food market: production of sugar, fruit and vegetable products, various kinds of children's and dietary food, etc. At the same time, however, Ukrainian is in a tentative position as its huge intellectual potential look more and more to head to developed countries in search of a decent salary and easier life.
And this is the main threat to the economic future of the country: no one wants to invest in an economy where there is no one to innovate. The competitiveness of Ukraine, like any other country, will be determined by its quality of labor resources.
52 Bohdan Khmelnytsky, Kyiv, Ukraine, 01030. of[email protected], www.evris.law
Andriy Dovbenko Managing partner, Evris