Ukraine’s unemployed rises by 156,000 amid the pandemic

Ukraine has registered 456,800 unemployed citizens as of May 4, an increase of 48% since the previous year, the State Employment Service reported on May 5.

Since the beginning of the coronavirus quarantine, the agency has registered 156,600 people as newly unemployed. Meanwhile, the number of job vacancies has decreased by 60% to 53,000 since March 12.

The highest rate of unemployed was registered in Dnipro, Kharkiv and Lviv oblasts, Deputy Director Yulia Zhovtiak said.

In a country where over 3 million people may be employed unofficially, the agency’s figures might not tell the whole story. According to Gennadiy Chyzhykov, president of the Ukrainian Chamber of Commerce and Industry, up to 2.8 million Ukrainians — or 15% of the working age population — may be unemployed today.

Still, the latest numbers from the State Employment Service help paint a picture of the economic fallout from the quarantine, which has shuttered most enterprises and driven small business owners to call for the government to lift restrictions and let them work.

With the quarantine now set to last until May 22, and Ukraine’s prime minister saying it could be extended for two months more, the government is looking for ways to help unemployed Ukrainians and struggling businesses.

Helping the unemployed

To support Ukrainian citizens left without work during the global COVID-19 pandemic, the government has allocated Hr 2.3 billion ($85.3 million) worth of unemployment benefits – 40% more than in the previous year, Zhovtiak said.

The minimum amount of the unemployment allowance during the quarantine and for thirty days afterward has increased from Hr 650 to Hr 1000 (from $24 to $37).

According to the State Employment Service, out-of-work Ukrainians can receive that money on the first day after they apply for unemployment benefits. The same rules apply to those who have quit a job voluntarily.

One can submit unemployment documents via email or register on Diya, a new online state services platform. The process is free and takes less than 10 minutes.

While there is currently a shortage of jobs in Ukraine, the State Employment Service said that demand for workers is growing in the health care sector, agriculture, retail, law enforcement and other industries that can operate during lockdown.

Supporting small businesses 

During the quarantine, the expectations of Ukraine’s businesses have grown distinctly pessimistic, according to a survey by the National Bank of Ukraine.

Small and medium-sized businesses have suffered the most from the lockdown, Prime Minister Denys Shmygal said on May 4 during a Cabinet meeting.

To support small and micro-businesses, Ukraine’s economy ministry plans to launch the “New Money” program for enterprises with an annual turnover of no more than $10.8 million, Economy Minister Igor Petrashko said. Under the program, the enterprises will receive loans for up to two years at 3% interest per annum. Businesses can use this money to cover salaries, utility bills, rent or tax payments.

Small and medium-sized enterprises can also apply for a partial unemployment allowance program that aims to support businesses that have been forced to suspend their activities during the quarantine. Under this program, for each hour of lost work time, the company receives two-thirds of the salary rate. The aid cannot exceed the minimum wage established by law in 2020 (Hr 4,723 or roughly $173).

On May 5, Shmygal said that the government will introduce a step-by-step plan to assist  businesses during the quarantine.