Inclusive labour markets for job creation in Ukraine
In view of the complex labour market situation the new ILO program funded by Denmark goes for an integrated approach based on three pillars. The program will modernize the services of the Ukrainian public employment services enabling them to offer more effective and inclusive active labour market policies. A strong skills component aims at closing the skills mismatch by better alligning the skills of new labour market entrants with the demand from the private sector. Finally, the program will support social dialogue mechanisms to solve critical issues such as informal employment, wages, or gender discrimination.
Ever since Ukraine became independent from the former Soviet Union 27 years ago, the country has been struggling to provide sufficient employment to improve the living conditions of its citizens. The unresolved military conflict in Eastern Ukraine has aggravated the situation as it lead to a sharp decline of Gross Domestic Product in 2014 and 15 (-16%) from which the country is only slowly recovering.
Employment indicators have worsened in recent years, disproportionally more for youth, women, and for those residing in rural areas. Traditional labour market indicators like unemployment rates (around 10%) do not reflect well the situation. Unemployment rates are artificially deflated by a high proportion of NEET (not in education, employment, or training) among school leavers (almost 30%). The traditional indicators also cannot cover a high perentage of informal employment and underdeclared work. An ILO survey from 2013 shows that 57% of young workers are informally employed. A further big challenge is the skill mismatch. A recent ILO School to Work Transition Survey shows that 37 % of young workers work in occupations that do not match their qualification with the large majority being overqualified. A recent challenge is the lack of skilled labour in certain secors caused by migration and an aging society. The Employers in Ukraine are already signalling that this development is becoming a constraint for doing business in sectors like manufacturing.
In view of the complex labour market situation the new ILO program funded by Denmark goes for an integrated approach based on three pillars. The program will modernize the services of the Ukrainian public employment services enabling them to offer more effective and inclusive active labour market policies. A strong skills component aims at closing the skills mismatch by better alligning the skills of new labour market entrants with the demand from the private sector. Finally, the program will support social dialogue mechanisms to solve critical issues such as informal employment, wages, or gender discrimination.
The new five year program is funded the Danish Neighbourhood Programme which is Denmark’s bilateral program for EU’s neighbouring countries in the East. Based on ILO’s good track record as a specialized agency on labour market and social dialogue with a strong presence in Ukraine, the Danish Government chose ILO as an implementing partner for the programme with a budget of 8,664,955 USD for 5 years.
Employment indicators have worsened in recent years, disproportionally more for youth, women, and for those residing in rural areas. Traditional labour market indicators like unemployment rates (around 10%) do not reflect well the situation. Unemployment rates are artificially deflated by a high proportion of NEET (not in education, employment, or training) among school leavers (almost 30%). The traditional indicators also cannot cover a high perentage of informal employment and underdeclared work. An ILO survey from 2013 shows that 57% of young workers are informally employed. A further big challenge is the skill mismatch. A recent ILO School to Work Transition Survey shows that 37 % of young workers work in occupations that do not match their qualification with the large majority being overqualified. A recent challenge is the lack of skilled labour in certain secors caused by migration and an aging society. The Employers in Ukraine are already signalling that this development is becoming a constraint for doing business in sectors like manufacturing.
In view of the complex labour market situation the new ILO program funded by Denmark goes for an integrated approach based on three pillars. The program will modernize the services of the Ukrainian public employment services enabling them to offer more effective and inclusive active labour market policies. A strong skills component aims at closing the skills mismatch by better alligning the skills of new labour market entrants with the demand from the private sector. Finally, the program will support social dialogue mechanisms to solve critical issues such as informal employment, wages, or gender discrimination.
The new five year program is funded the Danish Neighbourhood Programme which is Denmark’s bilateral program for EU’s neighbouring countries in the East. Based on ILO’s good track record as a specialized agency on labour market and social dialogue with a strong presence in Ukraine, the Danish Government chose ILO as an implementing partner for the programme with a budget of 8,664,955 USD for 5 years.