A six-year-long project to improve Ukraine's labour market, support entrepreneurship, strengthen social dialogue, and provide critical support to businesses and workers affected by the war has ended, after creating significant labour market improvements.
The project, "Inclusive Labour Markets for Job Creation in Ukraine," aimed to bolster entrepreneurship, improve social dialogue and provide critical support to businesses and workers affected by the war. It also significantly strengthened Ukrainian world-of-work institutions, actors, workers' and employers' organizations (the social partners), leading to a tangible improvement in labour market governance.
Key achievements included reform of the State Employment Service (SES), enhancing entrepreneurship, improving social dialogue between the social partners, and supporting internally displaced people (IDPs) and unemployed persons facing barriers to employment.
The initiative, which was launched in 2018, carried out its mission despite unprecedented challenges, including the COVID-19 pandemic and the Russian military aggression against Ukraine, launched in February 2022.
The DANIDA support of DKK 54 million (approximately USD 8.3 million) was complemented by an additional USD 1.1 million from the German development agency, GIZ.
Reform of Ukraine's labour market institutions
A central element of the project was the comprehensive reform of the State Employment Service (SES), undertaken with ILO guidance. This included significant restructuring and the introduction of four new services to enhance employment support: registrars, employment and specialized employment counsellors, and employers' counsellors. SES staff were also given extensive training in a new case management system that gives more effective support to job seekers and the unemployed. The new system allows collaboration with a broad range of related institutions, including medical rehabilitation centres, training providers, and social affairs departments.
The project successfully implemented the ILO's Local Employment Partnership (LEP) model in four Ukrainian regions. The LEPs are coalitions of local labour market institutions, educational institutions, NGOs and employers, which work to create job opportunities in line with local labour market needs. They improved labour market governance and service delivery, and introduced new occupational standards and training programmes. For example, a new occupation, upholsterer, was established with the support of Denmark's SKIVE College; occupational standards for cooks developed in the Kherson region have been adopted nationally; a new training centre was established in Sarny and the capacity of a Kherson training centre was upgraded. A training centre in Rivne also benefited from the upholstery training programme, thanks to funding from the regional government and a local furniture production company.
Empowering entrepreneurs and closing the skills gap
The project's support for entrepreneurship, also produced strong results. The "Start and Improve Your Business" (SIYB) programme trained 4,804 people, surpassing the initial target of 4,500. The programme also created a new generation of entrepreneurship trainers (although some have had to leave Ukraine because of the war). SIYB has now been officially adopted by the Ukrainian Government as the national entrepreneurship development programme.
Significant advances in closing Ukraine's skills gap were another achievement. Ten vocational curricula were digitalized and four were upgraded with the involvement of the business sector, creating a better alignment between workforce skills and market demands.
Strengthening social dialogue and labour relations
The third major project strand focused on strengthening labour market institutions and the social partners, mainly by improving social dialogue and conflict resolution mechanisms. Key achievements include development of a Green Paper on modernizing social dialogue and strengthening the legal aid systems of Ukraine's largest workers' organizations. This work resulted in the establishment of two new trade unions: one for deminers at the Halo Trust (an NGO specialized in demining), and another for transport workers at the Free Trade Unions of Railway Workers (VPZU) in Kryvyi Rih.
Through project support, members of the Federation of Employers of Ukraine are now also able to receive occupational safety and health training services. The National Mediation Service of Ukraine pioneered the ILO self-assessment tool that resulted in a strategic planning session and a new vision and mission for the institutions. Finally, digital training on social dialogue has been made available at the National School of Governance (National Agency for Civil Servants).
"Despite the formidable challenges created by the COVID-19 pandemic and the ongoing war, the project team exhibited remarkable resilience, innovation, and dedication, and the reforms will help to strengthen Ukraine's labour market and offer hope and a model of resilience as Ukraine continues to navigate the turbulent waters of conflict and recovery these times of crisis," said Claire Harasty, ILO Director for Central and Eastern Europe. "The project has created a foundation for future progress, demonstrating the power of international cooperation and the enduring strength of the Ukrainian people."
The Danish Government continues its commitment to fostering success by funding a new 10 million DKK (1.5 million USD) 18-month project in partnership with the ILO in Ukraine, starting 1 November, 2024. This initiative will target the implementation of Local Employment Partnerships in Odesa and Mykolaiv, with a focus on fostering entrepreneurship through training and start-up grants for socially vulnerable groups, including women, people with disabilities, war veterans, and individuals with outdated or limited skills. Additionally, the project will support the training and retraining of unemployed persons and internally displaced people (IDPs).
A key component of the new project will be strengthening social dialogue at the regional level. Moreover, efforts will be made to enhance social dialogue within a specific economic sector, which will be determined in collaboration with the Ukrainian government and social partners.
