Long-Term Unemployment in Ukraine

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Long-Term Unemployment in Ukraine

Journal Title: Демографія та соціальна економіка - Year 2013, Vol 20, Issue

Abstract

The paper describes the main trends in long-term unemployment in Ukraine during 2008–2012. The global financial and economic crisis challenges Ukrainian labor market by increasing the long-term unemployment. The acute long-term unemployment issues arose in the Ukrainian economy in the late 90s – early 2000s, when the widespread long-term unemployment has been accumulated during the economic recession in the mid-90s. Macroeconomic stabilization, the overall recovery of the labor market and the new job creation policy have led to a noticeable decrease in the number of the long-term unemployed over 2002–2007. However, crisis phenomena in the economy have led to the termination of this positive trend. Nowadays, the Ukrainian labor market is characterized by the persistence of significant amounts of long-term unemployment. Although in 2011–2012 the number of long-term unemployed was lower than in the «peak» 2010, it remained significantly higher than in pre-crisis period. Weak economic recovery was the reason why a significant number of people, who lost their jobs in 2008–2009 and in 2011, inevitably shifted or will shift in groups with longer unemployment, thus losing the chance to find a job. At the micro level, the individual long-term unemployment reduces the competitiveness of individuals in the labor market and eliminates the realization of their labor potential. At the level of society such kind of processes are transformed into the national human capital quality deterioration, increased social inequality, marginalization of the population, the growth of the social transfers and increased share of transaction costs. The main activities to minimize the negative effects of long-term unemployment should be aimed at preventing the transition of the unemployed to the long-term unemployed group. In the international practice, the risk of long-term unemployment is estimated depending on the initial level of unemployed person’s competitiveness. According to the estimated risk the various sets of employment services are provided for the jobseekers. There is no complete and reliable information about open vacancies in the national labor market and there is a significant mismatch between the national profession classification, educational standards and job qualifications formed by employers. In view of these facts it is very difficult to develop criteria for the identification of potential long-term unemployed in the initial stages of the unemployment. Therefore, the time after which being unemployed has more negative effects than positive is proposed as the main criterion for identification of potential long-term unemployed. According to international studies, this is the boundary after 14 weeks of unemployment. In addition to measures of preventing the transition to the long-term unemployment, attention should also be paid to the development of the reintegration measures for the existing long-term unemployed.

Authors and Affiliations

I. S. Marchenko

Keywords

EP ID EP287248
DOI 10.15407/dse2013.02.224
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