Europe struggles to convert Ukraine migration into labor boon

[July 21, 2023]  By Maria Martinez, Gergely Szakacs and Karol Badohal

BERLIN/WARSAW (Reuters) - European countries have not fully seized on the opportunity to plug workforce gaps presented by the arrival of millions of Ukrainian refugees, even though many of those fleeing the war are highly educated or have desperately needed skills.

The flood of people over the border following Russia's February 2022 invasion should have been a boon for countries in the European Union's east, where acute labor shortages have long dragged on economic growth and fuelled inflation.

But obstacles ranging from lack of childcare facilities to reluctance to recognize non-European academic and vocational qualifications has left vacancies unfilled and the - mostly female - new arrivals frustrated. Many are stuck in jobs below their skill and education levels and without the longer-term career prospects they are seeking.

Svetlana Chuhil sought a conditional license to work in Poland as an orthopedics doctor and physiotherapist shortly after fleeing with her two children. More than a year later, she was told her application required a key document that was stuck behind enemy lines in Ukraine.

A month after arriving in Poland, the 37-year-old, who holds degrees in orthopedics, physiotherapy and organizational management, took an internship at a social welfare centre paying 1,400 zlotys ($353.15) a month - then roughly half the local minimum wage.

Poland has one of the European Union's most highly-regulated labor markets, according to an October survey by consultancy Deloitte.

"I couldn't be hired as a doctor or physiotherapist without having my degrees recognized," Chuhil told Reuters.

After the internship, she took up two non-medical jobs, but struggled to reconcile a demanding work schedule with looking after her daughters.

Faced with high rents in the western Polish town of Zgorzelec, in December she moved across the border to Goerlitz in eastern Germany, where the government will pay for accommodation until she finishes a German language course and can find a job.

Since January, she has been volunteering at a centre in the city which offers psychological help to Ukrainian refugee women and children.

NOT A MISSED OPPORTUNITY - YET

The OECD think tank estimates that successfully integrating this latest group of refugees could expand Europe's workforce by half a percentage point and help alleviate labor shortages cited as a big factor in stubbornly high inflation.

But 17 months after the invasion, many are still employed on short-term or part-time contracts rather than in sustainable forms of employment, said Ave Lauren, migration policy analyst at the Paris-based OECD.

"I do not think the opportunity has been missed yet. What these countries need to do now is a second layer of labor market integration," Lauren added, highlighting the need for training, upskilling and qualification recognition.

In Germany, Europe's biggest economy, which United Nations data shows is hosting the most refugees from Ukraine, the number of open vacancies has risen to its highest level since the end of World War Two.

Maria, a refugee from Mykolaiv in Ukraine, decorates gingerbread Oktoberfest hearts at the 'Zuckersucht' bakery in Aschheim near Munich, Germany, May 18, 2022. REUTERS/Lukas Barth/File Photo

Even so, fewer than one in five refugees have found employment so far, as Berlin focuses on language courses that should help refugees find longer-term employment better aligned with their skills.

"There's always a trade-off between rapid and sustainable labor market integration," said Thomas Liebig, chief economist for the OECD's international migration department.

Oksana Krotova holds a master's degree in philology and worked as a hotel manager in Kyiv before the invasion. She now works as a hotel receptionist in Berlin.

"Nobody needs a hotel in a city in war," Krotova said.

Since January, the 34-year-old, who has no children, has combined a 30-hour-per-week contract with a second language course that has helped her reach fluency in German.

Aware of the difficulties in getting her degree recognized, Krotova wants to study business administration in Germany, where - like more than 40% of her fellow refugees in a recent survey - she now anticipates staying for some years.

Researchers from Minor, a migration policy think tank, said the large-scale inflow of refugees from Ukraine is seen as a great opportunity in Germany. There has been a "reality check", however, researcher Ildiko Pallman said, as their integration into jobs at a similar level to those they held at home is mostly not possible without speaking the local language.

And changing to a better job later isn't easy. "If you already work 40 hours a week and have no time for a language course, then it is very often the case that people get stuck," Minor researcher Gizem Uensal said.

While the refugees' fate is partly tied to the unknowable course of the Ukraine war, the EU's temporary protection scheme for Ukraine refugees is at present due to expire in March 2024.

"The closer we come to that, we need to have a strategy in place. It is too late to think about it next spring," the OECD's Lauren said.

This puts employers who want to hire refugees in a difficult situation, as they don't know if Ukrainian refugees will be able to stay.

"We need clear regulations quickly so that all those who have fled Ukraine for war reasons can stay in the long term," said Enzo Weber, labor market expert at the German Institute for Employment Research (IAB).

"That would remove a considerable hurdle not only for refugees, but also for employers."

($1 = 3.9643 zlotys)

(Additional reporting by Jan Lopatka in Prague; Editing by Catherine Evans)

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