International employment competition

International Labor Organization (ILO), a specialized agency of the UN, announced their forecast for this year. According to it, the number of unemployed people around the world will reach 202 million, comparing to 197 million of 2012. Five more million people are going to join the numbers of those who lost a job or cannot find the first one after graduating from a university. Further forecasts of the ILO do not look optimistic either. In 2014, the number of unemployed people will increase by three more million, and in 2017, the international unemployment rate will reach 210.6 million people. The ILO emphasizes that people under 24 are the most unprotected part of the society, 13 percent of them not having a job now.

UKRAINIANS LOOK FOR JOB EVEN ON THE NEW YEAR’S EVE

The number of unemployed has grown significantly in Ukraine as well. The State Statistics Service of Ukraine published the official information on their website saying that the load indicator on one job position reached the highest mark in December. The number of unemployed who applied for 10 jobs was equal to 108 people, which means there were about 11 applicants per job position. This is four people more than it was in November. The lowest demand for jobs was registered in August, only five people per position. Data provided by the State Statistics Committee indicates that in December, organizations and establishments offered 48.6 thousand job positions. In general, the number of registered unemployed in Ukraine grew by 0.2 percent in December as compared to the previous month, and it was 1.8 percent of the overall number of people capable of working. And these numbers relate only to the officially registered unemployed. In reality, things are much worse, experts say.

Staffing and employment agencies also say there is increase of the number of unemployed Ukrainians. According to their data, Ukrainians posted CVs and viewed vacancies even on the New Year’s Eve. The international staffing portal hh.ua provides interesting statistics: only on this portal, 104 people submitted their CVs on December 31, 2012, and 142 more submitted them on January 1. Applicants looked for jobs in sales, top management, and administrative staff sections. A technical support operator from Donetsk, sales manager, also from Donetsk, designer from Nikopol, director from Zaporizhia, and trainee counselor from Kyiv submitted their applications an hour before the New Year. And a web developer added his CV five minutes past midnight. He was soon followed by a sales expert, driver, and shop assistant. A bartender from Luhansk was the last person to submit a CV during the night of January 1, he did it at 3:01 a.m.

LOW SALARIES AND HIGH REQUIREMENTS

This competition among applicants gives employers a possibility to offer lower salaries and present more requirements for job seekers. According to the staffing portal, employers often put extremely high salaries for “young and promising” workers. Such salaries have the lowest fixed income possible, if any at all. The main part of the salary is made up of sales commission, which is yet to be earned. For a salary of 1,000 or 1,500 hryvnias, the employee is expected to be initiative, hard-working, capable of analytical thinking, considerably talented, ready to work overtime, and have their own client database. Really high salaries are offered to applicants with truly unique experience and skills. But even they should not expect significant salary increase or bonuses in 2013. According to experts’ forecasts, employers will be forced to tighten the belts this year, and it means that many enterprises and companies will work in a “saving mode.” The workers themselves talk about it too. According to the survey carried out by hh.ua, 27 percent out of 1,229 interviewed office workers expect serious business problems, redundancy, or even closing down of their enterprise. Almost a third of the interviewed employees expect stability in the new year: no cutbacks, but no significant expansion either. Overall 23 percent talk about possible slight redundancy, and almost as many people are sure that their company is to go through mass layoffs. According to the interviewed people, if the employers decide to turn the “saving mode” on, bonuses and salaries will be cut down in the first place. Expenses on nonfinancial motivation of workers will be the second in line, and only then expenses on business, advertising, and public relations will be affected.

The general forecast made by experts is the same: the number of unemployed people in Ukraine will only increase. The only way out of the situation is the change of economic policy of the country. Experts do not see any other effective methods that would change the situation in the current economic conditions.

By Larysa OSADCHUK, Ternopil

Viktor SUSLOV, former finance minister, honored economist of Ukraine:

“The unemployment rate increases, and so does the number of applicants for one job position. There is nothing strange about it. And of course, the number of unemployed people will only increase in the future. Economy is going through a hard period now. And since the recession started, production volume significantly decreased. According to statistics, the most dramatic reduction is observed in industry, transporting, and building. Of course, this will be followed by the increase of unemployment rate.

“Economic policy needs to be changed. Ukrainian government needs to cancel the harsh monetary policy, give up the erroneous idea of deflation and suppression of inflation. They need to stop using the policy of extremely high credit interest rate. Because credit interest of 30 percent in the conditions of zero inflation is impossible, it is unreal. Therefore, production is curtailed. This means that while trying to suppress inflation and keep the currency rate stable, the government carries out a policy that leads to reduction of production volume. And unemployment is just a consequence. So, if we want any economic development to happen, we need to carry out stimulation policy, cut down the interest rate, provide an access to inexpensive credit resources for the enterprises, support domestic production, carry out import substitution. Another economic policy is required, that is all.”

By Maria SEMENCHENKO, The Day