Using recent panel data from two Gradus surveys we show that by February 2021 urban Ukrainians have better adjusted to the new quarantine reality compared to April of 2020. Despite our expectations, we do not find any gender inequality in employment prospects and financial security. We attribute this to better chances of urban Ukrainian female workers to telecommute.
To work or not to work
The pandemic crisis hit the job markets of many countries including Ukraine. Policymakers and citizens have been facing tough questions: how can people save jobs? Who has better chances to adapt to the new reality by working from home? Can we maintain quality of life and be less stressed about the crisis? In other words, what makes Ukrainians more resilient to the crisis? In our previous article we investigated the immediate effect of the COVID epidemic on the job market outcomes of urban Ukrainians. We used data from the Gradus survey performed in April 2020 and found, in particular, that better educated respondents and those living in Kyiv are more likely to secure work from home. But better educated respondents were not always better protected from job loss or financial insecurity. What changed in the course of one year? In this article we use more recent data from February, 2021 to study how the job market prospects changed for urban Ukrainians.
Resilience in one year: lower chances of not working and fear of unemployment
Our results in Table 1 indicate that urban Ukrainians have adjusted to the ongoing pandemic in the middle run — perhaps, because of more adaptive quarantine policies since mass vaccination has not started in Ukraine in February 2021 yet. In particular, there are lower probabilities of not working (by 14.5% points), working from home (by 13.9% points), fear to lose job (by 6.9% points) and financial insecurity (by 10.1% points) during the second wave of the survey in February 2021 compared to April 2020.
Nevertheless, financial insecurity remains high – 53.8% of respondents in February 2021 report that they have savings for less than 1 month (a marginal improvement compared to 56% in April of 2020). In addition, the share of respondents who need to save on clothing (i.e. those in poor financial status) increased from 8.9% in April 2020 to 23.4% in February 2021 accompanied by a reduction in the share of wealthy respondents from 35.2% to 29.1%.
|Variables||Wave 1: April 8th 2020||Wave 2: Feb 15th 2021||Change in mean: Wave 2-Wave 1||Estimated change: Wave 2-Wave 1|
|Working from home||40.4%||25.3%||-15.0%||-13.9%|
|Fears to lose job||24.5%||20.8%||-3.7%||-6.9%|
|Savings for <1 month||56.0%||53.8%||-2.3%||-10.1%|
The class of precariat?
The good news is that on average Ukrainians are managing with the pandemic. Yet, there are some people who are doing better than others. What social and economic circumstances improve the economic wellbeing of Ukrainians? We identified risk factors for not working, working from home, and having few savings during the quarantine. What are they?
First, unofficially employed and freelancers were less likely to work during quarantine by considerable 19.6% and 10.8% points. Researchers have already seen that Ukrainian urban employees (e.g., waiters) have myopic attitudes about their legal status. Although freelance and civic contracts seem nice because of a higher take-home pay, these contracts have long-term disadvantages, including abrupt unemployment. To this end, Ukrainian urban employees face similar risks as many other employees around the Globe (such employees are sometimes called “precariat“). As Ukrainian policymakers suggested, official employment with flexible workday and remote work can solve this problem (as opposed to the outdated labor code). As we show further in the text, this solution indeed makes sense. Ukrainian female employees are protected from the labor market crisis by working from home.
We also find that both managerial position and industry matters. Being a supervisor before quarantine is associated with 6.7% points lower probability of not working. Working in hotels and restaurants increases probability of not working by a huge 53.1% points while employees in IT, research and advertising have lower chances of not working by 17.1%, 15.3% and 10.0% points respectively.
Second, chances of working from home (which is our second variable of interest after unemployment), are also affected by the level of education, industry, and favorable location. Respondents with higher education have 10.7% higher chances of working from home. Similarly, respondents from Kyiv have 11.3% higher probability of working from home. Respondents employed in manufacturing and health care are less likely to work from home by 16.7% and 19.0% points while those working in Education have 28.7% points higher probability of working from home.
Third, we observe that older respondents are 11.6-13.9% points more likely to have savings for less than one month compared to the base category of 18-24 years old. This result contradicts basic economic theory predicting that savings are increasing with age up until retirement but, perhaps, reflects a higher threshold of older respondents who have to provide for the whole household. Higher education reduces the probability of being financially insecure by 13.1%. Respondents in poor financial status are more likely to have savings for less than one month by 23.6% points while wealthy respondents are 23.3% points less likely to have this low savings. Those working in the private sector and NGOs are also less likely to have savings for less than one month by 12.0% and 9.8% (significant at 5%) points compared to the government sector. Similarly, respondents in supervisory roles are 7.9% points less likely to have low savings. Interestingly, regional characteristics and the industry are not associated with low savings at 1% level of statistical significance.
Fourth, since fears are often irrational, it is not surprising that there are not so many coefficients significant at 1% for the third variable – fear of losing a job. Wealthy respondents (who can afford expensive things like a TV set) are 8.5% points less likely to be afraid of job loss. Those working in the private sector and living in the Eastern region are more likely to fear job loss by 11.9% and 10.6% points.
No gender inequality?
Economists in developed countries have registered a significant pandemic effect on the gender gap in the job market (Alon et al., 2020). Various researchers appealed to the term “shecession” to describe the pronounced and abrupt trend of female unemployment (Alon et al., 2021; Fabrizio, Gomes and Tavares, 2021). The reason for that is twofold. First, previous crises affected specific industries of construction and manufacturing where men were overrepresented. In sharp contrast, the COVID-19 pandemic crisis affected hospitality and tourism where women were historically present at large numbers. The second reason for the gender gap in the job market is that many schools were closed for quarantine. Therefore, most parents had to take care of children. Since childcare responsibilities are skewed towards women in most countries, this household inequality constrains women’s ability to work from home. Drawing from these two observations, researchers suggest that telecommuting is the crucial factor of new gender inequalities during the pandemic (Alon et al., 2021). Ukrainian economists share such concerns and are worried about prospects of gender inequality in Ukraine.
On a positive side, we do not find evidence of “shecession” in our data of urban Ukraine. Our statistical analysis consistently indicates no gender gap in the probability of not working, fearing to lose a job or having savings for less than one month. This interesting result contradicts findings for developed countries where females are often found to be hit harder by the pandemic. Ukrainian urban female respondents, on the other hand, have higher chances of working from home. This may be a plausible explanation why “shecession” did not happen in urban Ukraine – female respondents in Ukraine better managed to switch to telecommuting compared to men. What’s more, women in urban Ukraine are more likely than men to work from home by a considerable 10.0% points.
Our results indicate that by February 2021 many urban Ukrainian workers have adjusted to the new quarantine reality, but financial insecurity remains high. Contrary to the evidence for developed countries, Ukrainian female workers are not doing worse than male workers in terms of employment, fear of losing their jobs or being financially insecure. While in developed countries women could have lost their jobs, Ukrainian urban females were able to switch to working from home. Our findings confirm the prior expectation that telecommuting becomes a crucial factor which can mitigate gender inequalities during the pandemic.
At the same time, our findings indicate that the crisis is likely to exacerbate other socio-economic inequalities. When we look at urban Ukraine, clearly there are people who are doing better than others. Some Ukrainians were able to save their jobs, to work from home, and to save confidence in the future. These people were more likely to be protected by government and state regulations (they either worked in the public sector or had official employment status). People who worked in the private sector as freelancers or without official contracts and those who did not have senior managerial positions were likely to lose their jobs.
We used two Gradus surveys including respondents from Ukraine aged 18-60 living in cities with a population of 50,000 or more. That is, the survey is representative only for the urban population. The first survey was conducted on April 8, 2020 and 1,176 respondents have responded. The second survey was conducted on February 15, 2021 and 1,002 respondents participated. The number of respondents in Gradus panel changed between the two surveys due to attrition and organic growth of the users. However, 672 (or 51.7%) respondents who participated in the first wave also appeared in the second wave whom we used for the longitudinal comparisons.
The authors do not work for, consult to, own shares in or receive funding from any company or organization that would benefit from this article, and have no relevant affiliations