The “Workforce Recovery: Demographic Strategy and Future of Ukraine’s Labour Market” panel in Rome began by laying out the facts. The event was held as part of KPMG’s Side Event to the Ukraine Recovery Conference, held under the patronage of the Ministry of Foreign Affairs of Italy and focusing on “The Role of Human Capital in Recovery.” More than 140 representatives from businesses, government, and international financial institutions (IFIs) from Ukraine, Italy, and the broader international community were involved. In the context of a prolonged war, while emotions remain the backdrop to every discussion, it is data that allows one to make informed conclusions and guides future action.
Ukraine is currently facing one of the most severe demographic crises in Europe, possibly one of the most severe in the world. According to the Ministry of Social Policy of Ukraine, the birth rate is as low as 0.9 children per woman as of 2025: one of the lowest among global population indices. By 2040, Ukraine’s labour shortfall is projected to reach 4.5 million people. More than 5.1 million Ukrainians are abroad, with 1.7 million of them economically active before the full-scale invasion. Moreover, 25% of the Ukrainian population is aged 60 or older, with an average life expectancy of 74.4 years for women and 65.2 years for men. These factors place systemic pressure on the pension system, lower the taxation base, and create a talent deficit across all sectors of the Ukrainian economy.
There is still a source of untapped potential, however. Current estimates show that only 27% of people aged 55+ are economically active and that only 16% of working-age persons with disabilities are employed. Among the 4.5 million internally displaced persons (IDPs), 42.3% are of working age, while Ukraine’s under-25s represent only 6.4% of the local labour market.
Ukraine clearly faces the vicious cycle of a demographic challenge and issues with activating underutilised human capital. Solving these combined problems will require systemic decisions, adaptive policies, and new approaches to human capital management.
Business, Society, and the State: A Triangle of Shared Responsibility
During the panel discussion, Tetiana Berezhna, then acting and now confirmed Minister of Culture and Strategic Communications of Ukraine and former Deputy Minister of Economy, noted that “all of the Ukrainian government’s decisions are based on data,” emphasising that activating human potential requires coordinated efforts among three actors. These actors are: a) the Ukrainian government, in setting the strategy; b) international partners, to provide support; and c) businesses and civil society, generating demand from within. In this triangle of roles, the state is not the sole driving force, but rather the coordinator of an ecosystem where it must learn to work with other parties, and not instead of them.
The Deputy Minister also reminded the audience that the agreement on access to the European Social Fund Plus (ESF+), signed on 12 July, is a test of both the ability to attract resources and to leverage them effectively. As Berezhna explained, “this is not just money but an instrument for developing human-centred employment.” Similarly, the Skills Alliance initiative, having already reached over 215,000 Ukrainians, demonstrates the effectiveness of partnership-based solutions in reskilling.
Another signal of progress is the Human Capital and Resilience Charter which is transforming approaches to supporting vulnerable employee groups, including veterans, IDPs, parents, and persons with disabilities. The Ukrainian labour market is gradually shifting from the neutral idea of a “workforce” to acknowledging the more complex logic of being an “ecosystem of opportunities.” The government’s readiness for regulatory modernisation also deserves attention: Ukraine’s Tripartite Memorandum on Labour Legislation Reform represents a step toward aligning the national labour model with European standards.
From the perspective of attracting human capital, the conclusion seems obvious. Ukraine has enough people but lacks mechanisms to enable their reintegration into the economy. It is therefore up to businesses, the government, and donors to go beyond a focus on financing and find ways to build educational, regulatory, and digital action platforms. Without these, any potential reserve will remain untapped.
Cohesion Policy: Lessons from Italy
Roberta Di Salvo, Head of the Directorate for Cohesion Policy Coordination at the Italian Ministry of Justice, explained to the audience that recovery is not only about physical infrastructure, like rebuilding walls and roads, but also about social reintegration. Her statement that “this is not only economic recovery, but also social and civic” served to clearly define the approach Ukraine needs in its reconstruction process.
Italy’s experience shows how the EU’s structural foundations, such as the aforementioned European Social Fund and the European Regional Development Fund (ERDF), are not simply sources of funding but are in fact tools for systemic transformation. According to Di Salvo, the Italian Ministry of Justice has succeeded in “integrating active labour market policies, vocational education, and digital transformation, not [merely] in parallel but in synergy.”
A key element of this success has been a multilevel approach: “We implemented initiatives at regional and local levels while maintaining a unified national strategic framework.” This model enables initiatives to adapt to community-specific needs while preserving strategic integrity. For Ukraine, the lesson is clear. Reconstruction should combine infrastructure investment with social solutions that both give people a roof over their heads and provide wider opportunities for integration, employment, and development.
Technology as an Enabler, Not a Substitute
Tetiana Lukyniuk, CEO of Google Ukraine, further emphasised: “We clearly understand that it is physically impossible to replace the people who have left the country. It is therefore crucial to now use technology to boost productivity and compensate for labour shortages.” This is not about automation to reduce the need for human input, but rather automation to enhance existing human capacity amid demographic constraints.
According to Lukyniuk, Google has already trained over 200,000 Ukrainian teachers in digital skills, and more than 150,000 people have completed freely available Google AI fundamentals courses. AI adoption is starting to become more widespread, though Lukyniuk also noted that “only 35% of users consciously use AI, while 85% interact with it daily through products like Chrome or Google Meet.”
Succinctly addressing common fears of replacement, Lukyniuk observed, “AI is the hands, and we are the brain.” The task of leaders, then, is to implement technologies while also teaching people how to use them. “You just need to know where you need help and dedicate five minutes a day to it,” Lukyniuk offered as a practical recommendation relevant to all, regardless of age, profession, or technical background. The audience shared a smile when Lukyniuk humorously confessed, “My AI’s name is Adam, and he supports me better than my husband.” This moment of levity also underscored an important point: AI should be accessible to everyone, regardless of their social or professional circumstances.
Employee Loyalty Begins with Employer Loyalty
Serhii Naumov, Chairman of Oschadbank, said, “Some companies began layoffs during the war. We did the opposite. We paid a double salary as a bonus and then raised wages by an average of 30% a month later.” According to Naumov, this choice helped to retain talent and built a new level of trust between the employer and its staff.
The results were impressive. “Most employees who went abroad later returned, despite ongoing risks,” Naumov said. This model answers what has become a key question for Ukrainian employers: how can we preserve our team amid uncertainty?
That’s not to say that staff deficits are not an issue for Oschadbank: over 800 vacancies remain open. Rather than waiting for external solutions, however, the bank has invested in its internal talent pool and engages diverse external groups. “We have invested in talent development for women, veterans, students, and even kindergarteners,” Serhii stated, acknowledging the long-term investment in upskilling across a broad cross-section of Ukrainian society. Oschadbank also finances veteran-helmed startups, supports rehabilitation programmes, and actively implements inclusive HR practices.
Oschadbank’s experience demonstrates how a new social contract emerges in crisis: employers invest in people and those people choose to stay, even when leaving might seem like an easier option. Employers must therefore implement policies that go beyond mere retention if they aim to build long-term resilience.
From Business Practices to National Trends
Government programmes and business-driven initiatives go hand in hand when it comes to shaping national trends for Ukraine’s recovery process. One such concept where both align is active longevity: a strategy for supporting a sustainable labour market and promoting an active, healthy, and professional lifestyle for citizens in all stages of life.
During the panel, Yuliia Bereshchenko, Director of Sustainable Business Development and Investor Relations at Astarta-Kyiv, shared how a company that employs more than 7,000 people and operates in 62 local communities systematically applies this approach. “We foster a health-conscious culture for a long professional life from the very first day — for young specialists, as well as experienced professionals and older workers. This approach combines support for physical and mental health, continuous learning, mentoring, flexible career paths, and actively combating prejudice. This has become a prerequisite for economic resilience and sustainability for the company, for communities, and for the state as a whole. In partnership with the Ministry of Social Policy of Ukraine and as part of the Demographic Strategy 2040, we are helping to develop the national Active Longevity programme based on Astarta’s practical experience.”
“Togetherness” – From Slogan to Viable Model
To conclude, let us recall the introduction and highlight some more facts and figures. During the KPMG event in Rome, we conducted a quick survey among approximately fifty business leaders, investors, and international establishment representatives. 97% of respondents expressed confidence in Ukraine’s long-term economic success, with only 3% expressing absolute skepticism. The majority believe that postwar priorities should focus on either reintegrating workers (37.2%) or support for entrepreneurship (30.2%). In education, vocational training ranked first in terms of prioritisation (31.1%), followed by entrepreneurship (17.8%), and STEM and the arts in joint-third place (13.3% each).
As a director of KPMG Ukraine’s IDAS practice, supporting government, business, and international donors in Ukraine’s recovery, I am convinced that our key task today is to turn challenges into opportunities for systemic growth. The discussions in Rome proved that effective solutions already exist: more than 215,000 Ukrainians have already been retrained under the Skills Alliance initiative and over 1,000 civil servants have completed training in AI fundamentals. Taking Oschadbank as an exemplar, businesses don’t simply talk about inclusion but actively implement practical steps to greater inclusivity: 16,000 of the bank’s employees now have medical insurance, 23 inclusive branches have been opened, and a bank anthem was even created with the aid of AI.
Ukraine is already a party to strong international partnerships, continues to implement ambitious national programmes, and has abundant local human potential. The next step is to scale proven solutions and develop models tailored to Ukrainian realities. Recovery is not a temporary phase, but a new strategy for sustainable development. Even as the shelling continues, we must already work towards building the Ukrainian labour market of the future. More than rebuild, we must rethink. Because labour is more than just the economy, labour is a gateway to personal dignity and our collective future.
