Rising Prices and Workforce Shortage: NBU Released Business Expectations Data.

September brought some easing in business activity assessments, confirmed by the business activity expectations index (BAEI) at 48.7 compared to 48.4 in August, as stated by the National Bank of Ukraine.

The improvement in entrepreneurs' expectations was influenced by the revival of domestic demand, an increase in the supply of goods, budget financing for infrastructure recovery and road construction, stability of the marine corridor, an increase in rail transportation, and the seasonal factor.

Unfavorable factors remained the shelling of critical infrastructure, uncertainty in exchange rate expectations, an increase in fuel excise taxes, a shortage of workforce, and an acceleration in inflation rates.

Business in Ukraine

The most optimistic assessment of their activities in the near future is held by the trade sector with a sectoral index of 52.1 in September. Industrial enterprises also positively assessed their prospects with an index of 50.3.

Construction companies maintained positive assessments with an index of 50.1. However, service sector companies experienced negative impacts with an index of 44.6 due to a shortage of qualified personnel and rising costs of labor and alternative energy sources.

Microgrants for Business / Photo: Unsplash

With the acceleration of purchase price growth, businesses in all sectors expect increased prices and tariffs for their products and services. The labor market situation is incomparable: only construction companies do not plan to reduce their workforce, while executives from other sectors predict a decrease in the number of employees, particularly in the service sector. It was reported that Ukraine is facing a workforce shortage.

The survey, which involved 474 enterprises, was conducted from September 4 to 23, 2024.