How many Ukrainians will be below the poverty line in 2023, will there be a new wave of migration?

25 November 2022, 05:32 PM
Europe is expecting a new wave of Ukrainian migrants (Photo:Ty ONeil / SOPA Images via Reuters)

Europe is expecting a new wave of Ukrainian migrants (Photo:Ty ONeil / SOPA Images via Reuters)

Marianna Tkalich, director of the Rating Lab research laboratory, talks about new migration trends among Ukrainians due to the war, the reality of the demographic gap, and the economic growth that Poland has received thanks to Ukrainians.

Europe is expecting a new wave of Ukrainian migrants — 11 million Ukrainians who have already left the country will soon be joined by another 2-3 million. This is the number who will be fleeing from Ukraine’s harsh winter of war, the European Regional Office of the WHO predicts. Another part will go in search of work and means of livelihood, as at least 5 million Ukrainians became unemployed due to the full-scale Russian invasion, according to the official data of the Ministry of Economy.

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In turn, the World Bank predicts that by the end of 2023, 55% of the population of Ukraine will live below the poverty line (compared to 2% before the war and 25% this year). Analysts believe that this factor will become an additional argument for leaving the country.

NV asked Marianna Tkalich, doctor of psychological sciences and director of the Rating Lab research laboratory, about how all this could affect life in Ukraine today and after the victory.

— How has the structure of Ukrainian emigration changed during the 9 months of full-scale war?

— We have had several waves of emigration. The first wave was panic and uncertainty – that is, people left the country until the front stabilized. And they still continue to leave those regions that become uninhabitable due to the war. Take, for example, Zaporizhzhya, where it was relatively quiet at the beginning, but closer to autumn, shelling became more frequent. The same is happening in Dnipro, where the city itself is intact, but district centers have been destroyed. Some of these people move to other cities, and some choose to go abroad.

Those fleeing the war have now been joined by a large number of those relocating their businesses. This is because with the current energy problems, the IT sector and international companies that operate online and need a stable internet connection can no longer rely on their work being uninterrupted if it remains in Ukraine.

There is now a whole wave of migrants forming who are leaving abroad in connection with the energy crisis. Many are also doing this anticipating a hard winter. These people have booked apartments abroad until March in order to "overwinter."

Another new category is people who at the very beginning moved temporarily to Poland, then returned to Ukraine, and after the new wave of attacks starting on October 10, again prepared for evacuation.

There are also those who emigrate for the sake of their children and for them to receive a foreign education. There are many such people who are willing to suffer to provide their children with a future. People who went with whole families or migrated alone are more likely to stay abroad forever. It is easier for those who have already changed their place of residence several times in their lives.

— How will the departure of millions of Ukrainians abroad affect demography?

— This is a Ukrainian expansion into Europe — millions of our citizens are already there, but most of them had never gone further than their own district center back in Ukraine. For them, it is an opportunity to see a different level of living standards and other values.

But we are losing our workforce, which naturally affects GDP. In addition to the fact that we have lost a lot of enterprises, we are continuing to lose our gene pool – new members of society. In addition to the able-bodied men who are fighting and the women who have left, we are losing children, some of whom will remain abroad. And the longer the children stay there, learn the language and adapt, the more we will lose. That is, it will reduce not only current taxpayers, but also future ones. A heavy burden will fall on the social sector, which is supposed to provide pensions, public healthcare, and other important social services. Even with strong humanitarian support from the world, this will be a heavy tax burden on those who have jobs and are working.

Overall, we will only be able to talk about real demographic forecasts in the spring, when we have gotten through this winter. The more positive news we have from the front and the faster the economic component improves, the more likely it is that some part of those who had left will return, and that those who remain will decide not to go.

— How will the new wave of economic migrants change the labor market?

— The economic argument, just like the security argument, is very important. Income is also security, only material and job loss can be no less frightening than rockets. This is a question, first of all, of employment. Those who leave for economic reasons do so because there are currently no conditions or development opportunities for them in Ukraine.

Fewer children will be born, and a demographic hole awaits us ahead, while the number of applicants for jobs is already shrinking. This is a question of the quality of specialists who will later be available on the labor market. Because those who leave for economic reasons are often those people who can get a good job. On the other hand, the selection of jobs available to those who remain will be greater, because specialists of their qualifications leave and access to vacancies is becoming wider.

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But for now, these are conditional losses, because everything will depend on the country's recovery program. On the contrary, with the right approach, Ukraine can become an attractive labor market.

In any case, if we consider that we are going to join the EU, and sooner or later the borders will be opened, then even without any war there will be a wave of people leaving Ukraine. This was the case with Poland: when it joined the EU, there was a huge exodus of the population who went to look for a better life. Here there will be a question of state policy and the policy of large enterprises: what they are ready to offer so that people do not leave.

— Currently, a new category of Ukrainian migrants is appearing: those who received a resident card from the EU and now live in two countries. How can they affect the economy of Ukraine?

— These nomads are not the worst category with the motto "you can't-go-stay." These are often people with remote jobs who can afford to work from anywhere, but there can be advantages for the country only if they work for Ukrainian enterprises and pay taxes to the country. And if half of their salaries will be spent in Ukraine, as long as they stay here, that's great.

This is also an opportunity for Ukrainian companies that previously did not want to enter the European market, but are now forced to. All these people have relatives in Ukraine in one way or another, even if they get settled and start earning in the EU, they will still help and send money here.

— Who are the people who have remained in Ukraine, and will their efforts be enough to raise the economy back up?

— For women, going abroad is one solution, but it is not right for everyone. We conducted research on people’s intentions to leave. The number of people willing to leave and live and work abroad has tripled compared to the pre-war period. Those who wanted to leave have already done so, and those who stayed did so not because they cannot leave, but because they do not want to.

First, we always talk about money, but there is such a thing as social status and self-esteem. Having left for Europe, with minimal knowledge of the language, you can work in a supermarket and even earn more than, for example, a professor in Ukraine. But beyond the financial factor, there is a behavioral and psychological factor, because social status is not sold for money. That is, not everything is decided by economic factors if a person had intellectual work, a good social circle, a good lifestyle, and property.

On the other hand, there are interesting statistics regarding Ukrainians who want to have their own businesses. According to the Rating Sociological Group, their number has tripled compared to last year. We have studied Ukrainians’ economic behavior of Ukrainians several times over the course of the active phase of the war and found out that the number of those who are ready to start a business, change their profession, and get a new education has increased. That is, it means that while a lot has been lost, not everything has. Statistics of new business openings are also increasing. That is, war should be understood as a crisis, but a crisis is always a window of opportunity.

It is now customary to say that we do not have a profession, but a set of competencies. Therefore, proactive people with certain skills will be able to fully realize their potential.

— According to World Bank forecasts, 55% of Ukrainians will live below the poverty line by the end of 2023. How realistic is this forecast?

— We are in the active phase of the war, so all forecasts now are just reading tea leaves. By 2023, the poverty line may not be 55%, but, for example, up to 73% or as low as 30%. Everything will depend on how and when the war ends, how much destruction there is, how long Europe provides us with macro-financial assistance, and whether there will be a conditional "Marshall Plan" for Ukraine.

Otherwise, the situation will be critical, because we have lost a large percentage of the working population, and this is a very big blow to our GDP. At the same time, in Poland, on the contrary, there has been economic growth thanks to our workers, as every tenth worker there today is a Ukrainian.

But it should be understood that the criteria for calculating the poverty line are quite averaged, and do not take into account the individual characteristics of the country. All the more so now, as before the war, most of the income and businesses in Ukraine were in the shadows. This is not to say that we do not have poor people, but rather that we have too many unaccounted for.

These objective indicators are usually calculated based on the level of income necessary to cover minimum needs. One thing is certain: if we have a 30% reduction in GDP, then the level of poverty will increase. But at the same time, the banking system is functioning and doing well, and the number of people who were able to return to work is 60%, while another 7% have found new jobs.

Therefore, the question arises here as well, what exactly should be considered the poverty line. Ukrainians live with the motto as in the joke: "There are three levels of poverty: 1) I have no money. 2) I have no money at all. 3) I'm going to change my dollars (because now I really am out of money –ed)."

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