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Being guest worker: How dangerous is labor migration for Ukraine?

Author : Yuriy Hryhorenko

23:46, 5 February 2018
Being guest worker: How dangerous is labor migration for Ukraine?

Author : Yuriy Hryhorenko

European countries in every possible way simplify access to their markets for Ukrainian workers. Even in the summer of last year, Poland allowed visitors to work on a visa-free basis in the format of seasonal employment

23:46, 5 February 2018

Read original article at 112.ua

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Ukraine is a part of the global economy, and labor migration should be treated as a natural and inevitable process. "Labor migration is a natural process, and it cannot be stopped. We can make comparison with Poland, where GDP has been growing for the last 25 years, but every year young Poles leave for Western Europe and work there because in these countries the level of well-being higher and there are more prospects," says the president of the All-Ukrainian Association of Companies for International Employment Vasyl Voskoboynyk.

It is quite difficult to estimate labor migration in terms of numbers. In fact, statistics do not exist because 99% of the international employment market is in the shadow. According to the Ministry of Foreign Affairs of Ukraine, about 5 million of our fellow citizens live and work abroad. However, this figure is constantly changing (some of the employees are engaged in seasonal work) and might be even higher.

"We can say with confidence that more Ukrainian labor migrants left for work abroad in 2017 than in 2016. And, accordingly, in 2018 will leave more than in 2017. Conducted by the All-Ukrainian Association of Companies for International Employment sociological studies have shown that 72% of Ukrainians surveyed go to work abroad because there is a higher level of wages," says Vasyl Voskoboynyk.

It should be noted that European countries in every possible way simplify access to their markets for Ukrainian workers. Even in the summer of last year, Poland allowed visitors to work on a visa-free basis in the format of seasonal employment. The Government of the Czech Republic doubles the quotas for workers from Ukraine - up to 19.6 thousand a year. However, the Czech quota fades against the background of more than 1 million Ukrainians, who, according to official data, work seasonally or permanently in Poland. In general, it is the visa-free regime, which the government exposes as one of its major achievements, is the reason why Ukrainians are massively going to work abroad.

Obviously, despite the fact that 5-7 million Ukrainians are already working abroad to some extent, the potential for increasing their number remains: after the devaluation of hryvnia and the implementation of visa-free travel, the number of people wishing to go abroad to earn money has increased noticeably. According to a survey conducted by the Kyiv International Institute of Sociology (KIIS), a third of Ukrainians are thinking about leaving the country, and 6.3% are already taking action in this direction. The reasons for a possible departure are the desire to earn more and live in a more comfortable country.

As Vasyl Voskoboynyk points out, at the current level of economic development of Ukraine labor migration will intensify. Ukrainians will go more actively to work abroad, primarily to European countries. At the same time, the outflow of our labor migrants from Russia will continue due to the economic crisis in this country and the worsening of ongoing bilateral relations.

People of completely different specialties leave for work in other countries. "Not only representatives of working specialties (builders, drivers, laborers, agricultural workers) are leaving for other countries, but also qualified personnel. Not all of them return. In general, migrant workers are mainly engaged in jobs that do little to improve their skills. Better places have scientists, IT specialists, rare specialists in technical specialties, mathematicians, and physicists, "said Victor Shulyk, director of the department of market studies of IBI-Rating agency.

According to Vasyl Voskoboynyk, almost half of those who worked abroad worked in construction and repair (43%), half (23%) in agricultural work, 10% in domestic work, 3% had experience working in IT, childcare, restaurant business (cooks, waiters, cleaning).

It should be noted that very few people can work abroad according to their profession. These are builders, agricultural workers, seamen, programmers. The majority will continue to work as low-skilled workers, despite the specialty that they had in their homeland. This is due to the lack of knowledge of foreign languages, as well as the partial non-recognition of our diplomas in Europe. Labor migrants need money now, and they usually do not have time to learn new profession abroad, so they work there, where you can earn money immediately from your arrival.

Migration directions

As experts say, there is no exact statistics on the directions of labor migration in the regional context. However, one can rely on sociological studies that give a fairly accurate picture of the preferences of Ukrainians.

 

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By order of the All-Ukrainian Association of Companies for International Employment, the sociological group "Rating" in 2016 and 2017 conducted a number of studies that showed that Ukrainians went to work in Poland (36%), Russia (25%), 5% worked in the Czech Republic and Germany, 3% - in Italy, the rest - in other countries, mainly in Western Europe. Almost 30% of respondents refused to answer this question, and it can be assumed that most of them work in Russia, but it is considered unethical to talk about it.

However, the list of countries where Ukrainians work does not coincide with the list where they would like to apply their work skills. "Most often, among the countries where respondents wanted to work abroad, they called Germany (37%), 26% want to work in Poland, 22% in the USA, 21% in Canada, 16% in Czech Republic, in Italy - 15%, in Britain - 14%, in France or Sweden - 12%, in Israel - 11%, in Spain - 9%, in the Netherlands - 7%, in Russia - 6%. In other countries, less than 5% of respondents would like to work. Germany, the United States, the Czech Republic and the United Kingdom as the most desirable countries for work more often than others were chosen by the inhabitants of the west, Russia – of respondents in the east, "- says Vasyl Voskoboynyk.

According to the above KIIS survey, more than 60% of respondents do not see anything seditious in labor migration to Russia. On the one hand, Russia is not included in the top 5 countries (Germany, Poland, Canada, the United States, Italy), where the Ukrainians would like to leave for work, and on the other hand, for 9 months of 2017 Russia was in second place in terms of cash flows to Ukraine with an indicator of 460 million dollars (a leader is the US, 547 million dollars).

Shortage of staff

In connection with the outflow of personnel abroad, the question arises: what specialists will Ukrainian economy lack. This depends a lot on the direction in which the Ukrainian economy will develop. Already there is a shortage of builders, engineers, agronomists, good "salesmen". A separate issue is connected with scientists because many people in this area are already retired or will soon be.

"The problem is not only and not so much in migration, as in the unpopularity of many professions and the lack of a quality training system. The training of working specialties in the country is still unpopular, although many domestic companies pay relatively high salaries to employees. But now only a few companies can boast of quality mentoring programs, "said Victor Shulyk.

In this regard, it is possible to predict not the deficit of lawyers, economists and various managers, who are prepared by Ukrainian universities, but a deficit of representatives of working specialties. "Thus, in the medium term, I forecast a shortage of high-quality specialists in the working professions, provided that the growth rates (the same construction, road, and repair work) will remain at the current level," Viktor Shulyk said.

For his part, the president of the Ukrainian Analytical Center Oleksandr Okhrimenko believes that Ukraine will never have a deficit of specialists, since, as a rule, unskilled labor leaves the country, and qualified personnel work in Ukraine and they have no reason to leave. "It's another matter that business does not always want to pay wages honestly, so let them raise the salaries, and there will be no shortage," the expert adds.

It should be noted that the problem of shortage of qualified personnel is associated not only with labor migration but also with the natural decline of the population. According to UN estimates, Ukraine is among the five countries in terms of population decline. Thus, the UN estimates the population of Ukraine, including Crimea, in 2017 to 42.2 million people, but by 2050 the population of the country will decrease by 18%, to 36.4 million people. In any case, a significant decline in the population in the medium term is a threat to the national security of the country.

The effect of migration

Labor migration has a multifaceted impact on the Ukrainian economy. The negative impact is the outflow of qualified personnel, the imbalance of the labor market and the system of social and pension payments (labor migrants do not pay taxes to the budget and to the Pension Fund).

"Migration hinders the development of the economy, and the" brain drain "worsens this indicator for investors as the availability of skilled labor. Labor migration also increases the social burden on those who stayed and work officially in the country (taking into account the Ukrainian joint pension system), " says Victor Shulyk.

In Poland, it is plainly said that labor migrants are needed to ensure and preserve the economic growth of this country. In Poland, as in Ukraine, the aging of the population and the migration of specialists to other countries (Western Europe and the United Kingdom) are observed. Ukrainians successfully replace their outflow of personnel, while our country is only a donor of the labor force, and not its recipient, which is Poland.

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On the other hand, a shortage of labor in certain sectors contributes to "tightening" wages in the domestic market, and as a result, the contribution to GDP (final consumer spending of households) may increase. The positive effect on GDP is also exerted by the receipt of currency in the country, as well as by money transfers - the support of migrants for their families and relatives who remain in Ukraine. But against the background of a general decline in consumption, this contribution is mediocre.

In his turn, Olexander Okhrimenko does not see a threat to the Ukrainian economy in labor migration and is sure that it needs to be stimulated. "The more Ukrainians going abroad to earn money, the better it will be for Ukraine's economy. First, there will be fewer unemployed, which means that wage growth in Ukraine will accelerate. Secondly, labor migrants will transfer currency to Ukraine and thereby contribute to the budget increase. And thirdly, people, having earned money abroad, will return to Ukraine and, at the expense of accumulated funds and European experience, open business in Ukraine. Therefore, it is necessary to stimulate the export of labor from Ukraine. It is necessary to work out a state program to support Ukrainian labor migrants and to entrust the Ministry of Foreign Affairs of Ukraine with the requirement to conclude agreements with other countries on labor migration. Today, Ukraine can really become the main supplier of skilled workers in the EU and this will ensure both its future and the EU," the expert believes.

We recall that according to the NBU, for 9 months of 2017 the volume of private money transfers to Ukraine increased by 30% and amounted to 5.2 billion dollars. This amount exceeds the amount of direct foreign investment in the country, and the total volume of remittances of labor migrants is at least 3-4% of the annual GDP of Ukraine. This is a significant contribution to the development of the country's economy, which cannot be ignored.

If the government of Ukraine can ensure a high growth of the economy (at least 7% per year), the flow of labor migrants from Ukraine will slow down, but it will not stop. Having a number of neighbors who are far superior economically (the Polish GDP is 5 times higher than the Ukrainian one), it is impossible to stop the residents of Ukraine from going to work abroad. And this is a reality that everyone needs to understand.

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