Ukraine’s population will decline to 32 million by 2050, according to UN estimates, unless policy interventions are undertaken, analysts warn. Along with the gradual decline, the ratio of age groups will be disrupted. By 2070, the number of elderly people (60+ years old) will surpass the working-age population (18-59) – 11.1 million versus 10.9 million. This means a critical level of population aging, substantial pressure on healthcare, social protection and pension systems. To maintain living standards, the labor market inclusion of vulnerable groups, pensioners, will be essential.

The ability of local communities to integrate and support veterans is a critical prerequisite of sustainable socio-economic development. Centralized solutions will be less effective, as the uneven distribution of veterans across regions creates an imbalance in the burden on the social system. After the end of the war, assumed to be in the end of 2025, the share of veterans and their families who need special attention to health issues and reintegration into civilian life will increase to 15% of the total population with 4-5 million of veterans, while in 2024, there were about 1.35 million veterans already. Notably, over 60% of veterans will be under the age of 40, highlighting the need for a forward-looking veteran policy focused on integrating young veterans into civilian life and employment.

The war has also led to an increasing number of people with disabilities. While ~40% of them do not require specialized workplace adaptations, their economic participation remains limited. As for today, ~16% of people with disabilities of working age are involved in the labor market. However, only 16% of vacancies are adapted or marked as accessible for this category. In 2024, only 6% of people with disabilities used training and employment services. At the same time, at the beginning of 2025, they make up ~9% of the population (3.4 million). This points to a strong potential for public-private partnerships to facilitate labor market integration and help address labor shortages.

Internally Displaced Persons (IDPs) represent another major group requiring targeted support to enhance economic inclusion. Updating IDP registries is a high-priority action to enable effective reintegration and delivery of assistance. Currently, IDPs officially make up ~12% of the population (over 4.6 million). Their actual number is 950 thousand less, as many do not deregister after returning home or moving abroad. Only 7% of unemployed IDPs applied to employment centers in 2024, which also points to the need for improving accessibility, communication and trust to state services.

The labor market situation requires special attention and a revision of current policies to make post-war recovery possible. 63% of companies in 2024 reported difficulties in recruiting staff, according to the Institute of Economic Research and Development, mostly the qualified one. The only sector which shows employment growth is public administration and defense. The number of employees in this sector reached 2.6 million. This accounts for 23.8% of the employed population and is explained by large-scale mobilization to the Army. In other sectors of the economy, employment is declining. Most rapidly in industrial sectors (mining and manufacturing) – by 37%, and more slowly in the social sector (education, healthcare) – by 11%. But this still indicates a critical drop in overall economic productivity.

To address these challenges, Ukraine must transition from the current social support model to a productivity-oriented system. In 2025, appropriate measures will be implemented in the areas of social insurance, child protection, support for veterans, and inclusive development. In particular, gender budgeting, introduction of a basic social assistance scheme instead of various types of privileges, revision of approaches to the calculation of special pensions, improving employment support for people with disabilities, updating the Labor Code, and steps towards deinstitutionalization are expected. These changes will increase economic efficiency and bring Ukraine closer to EU standards.