While small in absolute numbers, Ukraine’s expatriate community carries disproportional weight in the country’s business world.
Despite the economic troubles, many foreigners continue to come to Ukraine, enticed by higher salaries and new challenges that compensate for lower living standards.
Estimates of the number of expats in Ukraine vary widely – from millions with citizens of former Soviet republics, to just 100,000 for the rest of the world, to close to 53,000 foreign registered taxpayers as of January 2013, according to the State Tax Service.
A survey of 226 foreigners working in Ukraine by Ernst & Young’s Human Capital Research Group, carried out with the Kyiv Post’s support, identifies the most salient features of this group.
Ukraine’s expats are most visible in the nation’s business circles, where they often fill senior positions. More than a quarter of respondents are general managers or chief executive officers at their companies, with a further 12 and 6 percent working as top and senior managers, respectively. Just over 40 percent filled professional positions, with the rest comprised of business owners and middle management.
Foreigners are no doubt drawn by higher salaries – 44 percent said their income increased upon arriving to Ukraine, while 65 percent noted the cost of living was slightly or much lower than in their home country.
In exchange for the high salaries, companies in Ukraine get skilled and experienced professionals, a feature in demand locally. They are also increasingly fluent in Russian or Ukrainian, with only a 24 percent claiming no knowledge in either, and almost half claiming a good or very good level.
Present in almost all sectors, half of surveyed expats complain about the lack of qualified workforce in Ukraine. The biggest problem areas: general management, business development, customer service and administration.
Still, business executives increasingly point to the younger, better qualified generation of cheaper Ukrainian workers as being fit to fulfill all the required tasks – with better language and local knowledge skills to boot.
Yet the community sees a constant flow of arrivals and strong turnover, contradicting the image that expats are a small group of old-timers. Indeed, while 16 percent of the survey’s respondents said they have resided in Ukraine for more than a decade, the biggest group, representing just under a third, have been here for one to three years.
Origins are also changing. While Canadians and Americans, often with Ukrainian roots, dominated the scene in the 1990s and early 2000s, nowadays almost half come from the European Union. Surprisingly, though, support for Ukraine’s EU membership in coming years is low at 29 percent.
Encouragingly, most plan to stay for a quite a while: 32 percent plan to stay one to three years more, 34 percent plan to spend at least half a decade.
But that depends on efforts by Ukraine’s authorities to improve the country’s business and social climate. Indeed, problems with the state authorities are arguably the biggest problem for expats, 88 percent of whom are not satisfied with their work, up from 70 percent in a similar 2010 survey.
The top offenders are the courts, the police and the traffic inspectorate. On the other end of the spectrum are immigration authorities, with just 62 percent of low satisfaction.
In order to deal with this problem, most resort to “payments or gifts.” Just under a quarter claimed that businesses always resort to bribes for “get things done,” with a whopping 52 percent saying it was frequent. Only nine percent said this never happened.
Their personal experiences are also troubling: more than two-thirds of respondents said they encountered the necessity to make unofficial “payments or gifts.” Traffic police, medical institutions and customs were noted as the biggest bribe-seekers.
“Street police, DAI, is nothing but cash collection, less for the state but for their own pockets,” read one comment.
Unsurprisingly, three quarters of respondents noted corruption among the problems of the business climate, which polled a disappointing 64 percent of low satisfaction. Taxes, customs, courts were also named as big cons, as was political instability. In comments most complained about bureaucracy, incompetence, and rudeness.
The quality of life, particularly the social aspects, are also a big downside. A fifth of respondents said their amilies remain abroad, with quality of education and the inability to assure appropriate standards among the main reasons why. Furthermore, around a quarter noted that negative aspects of social life and low living standards could lead them to come home.
The most disappointing social sphere is the media, with only 21 percent claiming they were satisfied and many complaining about biased outlets.
Nonetheless, almost 60 percent of expats claimed to be generally satisfied with work and life in Ukraine. Warm and friendly people were mentioned by 61 percent as the most likable aspect of their lives in Ukraine, followed by hard-working and strongly motivated people. Cafes, hotels and telecommunications providers also received good grades.
But for many personal contacts are the problem. Among the most disagreeable aspects, most noted corruption, but rudeness came in a strong second. Next came customer service, bureaucracy and closed-mindedness.
“Most business people we come in contact with have poor people skills,” said one respondent.
“People who deal with foreigners mostly are trying to see what they can take,” complained another.
Yet for others that might be part of the thrill-seeking Ukraine experience. Asked about the most likeable aspect of living in Ukraine, one respondent said: “A ‘rough and ready’ lifestyle.”
Kyiv Post editor Jakub Parusinski can be reached at [email protected]
