Determinants of the spatial differentiation of labor markets in Poland and Ukraine

Abstract

The purpose of this chapter is to discuss and compare the situation of the labor markets in Poland and Ukraine. The subjects of the analysis are the basic determinants of its diversity in space and time. In the analyses carried out, economic variables such as labor productivity, wages and unemployment rates were employed. In both the Polish and Ukrainian economy, a large variation can be observed in the time and space of the labor market variables analyzed in this chapter. At the same time, the scope and level of such diversity in the Polish economy is primarily due to the economic cycle, while in the case of the Ukrainian economy it is mainly due to political instability. Political instability is particularly evident in the analysis of GDP growth trajectories, employment productivity and falling unemployment rates. A confirmation of the importance of political stability is also found in the results of those econometric analyses which show that in the Polish economy, the sensitivity of unemployment rates to changes in economic growth rates was at a much higher level than in the case of the Ukrainian economy. The research conducted in this chapter also reveals that the diversity of labor productivity in Ukraine was greater than the diversity of this macroeconomic variable in Poland. The differences in unemployment rates as to trends over time were at a similar level in both economies, while the differences in wages were lower in Poland, where, moreover, a tendency to convergence of this macroeconomic variable can be observed.