Reserves for increasing the labor productive activity of national human resources in Ukraine

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Reserves for increasing the labor productive activity of national human resources in Ukraine

According to UN General Assembly Resolution «Transforming Our World: The 2030 Agenda for Sustainable Development», approved on September 25, 2015 (A/RES/70/1) one of 17 global goals for sustainable development is to promote complete and productive employment and decent work for everyone (Goal 8) [1].

The concept of a decent work, proposed by the International Labour Organization as a global goal and a basic strategy for the labour market development, determines the achievement of productive employment as a priority, which has to ensure sufficient income for decent living, sustainable economic development and competitiveness of production and the country as a whole. Labour productivity and unit labour cost have been added to the Key Indicators of the Labour Market (KILM) by International Labour Organization. Labour productivity is defined as a general indicator of labour performance, which characterizes the efficiency of its expenses on production and services. According to [2] labour productivity for international comparisons is defined as the ratio of gross domestic product (GDP) due to the purchasing power parity and number of employed population (according to the analysis of economic activity of population by Labour Force Survey). International comparisons of GDP (due to the purchasing power parity) per one employed person, reflecting the labour productivity, are pointing to [3] the significant underrun of Ukraine from economically developed countries (Sweden, Germany, France), as well as post-Soviet countries by this indicator. This may be the result of Ukraine's staying in a crisis situation for quite a long period of time, thus leading to the reduction of GDP volumes and preservation of a significant share of «shadow» economy in the country.

Problems of increasing labor productivity were in the field of scientific interests of W. Geitz [4], I. Zayukov [5], G. Baklanov and G. Kildishev [6], L. Lisogor [3], as well as other domestic and foreign scientists. Leading Ukrainian scientists, in particular V.M. Geiets [4], noting the tendency of weakening the motivation to increase the labour productivity, the level of education and competence of workers, have suggested as an argument the existing strains in wages, the pre-eminent growth of the share of social transfers in the structure of population's income in comparison to the share of wages in recent years.

In general, this indicates that both society and science are aware of the importance of improving the labour productivity as a prerequisite for the growth of the economy competitiveness and existence of a number of factors to counteract its growth.

The article is devoted to the definition on the basis of interstate comparisons and assessments of experts of promising areas of increasing labor productive activity of human resources in Ukraine.

Labour productivity, calculated at the macro level in Ukraine in 2014 was 9% lower than in 2013. In 2015, compared with the previous year, there was a decrease of GDP per capita by 8% (681 USD), Table.

The impact of GDP on the salary in some European countries [7]

In 2015 labour productivity per person employed in Ukraine (within current prices) amounted to 120.4 thousand UAH, which is 0.9% below the level of previous year. In this case, the number of employed population aged 15-70 decreased by 9%. As a result, in 2015 the drop in real GDP was 9.8% compared to 2014 [8]. In the third quarter of 2016 GDP per person employed aged 15-70 was 40.2 thousand UAH, which is 3.3% more than the indicator of labour productivity at the national level of corresponding period in 2015, and this happened under the growth of GDP by 2% and reduction of the number of employed population by 1.3%. In comparison, the average level of labour productivity in the USA is 137 thousand USD per person employed. Ukraine lags behind the indicator of labour performance from such countries as the United Kingdom, Israel, Canada and Japan in the range of 4-6 times, from such CIS countries as Azerbaijan, Belarus and Kazakhstan by 2-2.5 times and in relation to Russia by 1,7 times. In addition, due to the low labour productivity Ukraine's labour force is being underestimated in relation to the world developed countries (Table 2) [9]: in terms of the ratio indicator of GDP per capita to the hourly salary, labour productivity in Ukraine is underestimated almost twice relative to the average value of EU countries, and by 4 times - in comparison with Belgium, France and Sweden.

Evaluation of individual indicators of labour expenditure in some countries as in 2013

According to the statistics by International Labour Organization [8] the value of labour productivity in the world developed economies and EU countries exceeds the corresponding world index by 3.4 times, in the Central and Eastern Europe - by 1,1 times, in the countries of the Middle East - by 1,6 times, while such regions as East Asia, South Asia, North Africa, Latin America and the Caribbean have the labour productivity index much less than the world-wide value, indicating the presence of respective imbalance between the countries.

Ukraine has a resource-based economic model of development based on a relatively low level of efficiency, the dominative role of metals, chemical products and agriculture in Ukrainian export, mainly at the raw material level, instead of high value-added production. Ukraine has low levels of GDP per capita and labour compensation due to the insufficient level of introduction of modern innovative technologies, new equipment, production technologies, high material and energy consumption of national products, which are affecting their cost and competitiveness (the energy intensity of Ukraine's GDP exceeds the corresponding value in the world developed countries approximately by 5 times), thus explaining the decline in the real wages of Ukrainians, as our enterprises spend five times more energy on the production unit and this increases its cost, making it uncompetitive in the international markets.

During the years of independence, the use of human capital has been practically limited, while in the developed countries it is the most valuable resource and is a prerequisite for the growth of labour productivity. For example, comparing the value of the average hourly salary in Ukraine with such countries as Sweden, Denmark, France and Italy, it becomes clear that the labour compensation of Ukrainian citizens is 20 times less (Table 2).

Improvement of the labour force qualitative characteristics is one of the aggregated factors in the whole set of reasons for the change in labour productivity, consisting of (1) measures to improve business activities, which include the foundation of new enterprises, introduction of new structural units of existing enterprises, reconstruction of existing enterprises and their structural divisions, improvement of working equipment at existing enterprises, improvement of labour materials and supplies, change in the methods of combining the labour force, means and supplies, change in characteristics of produced goods and services and (2) change in the natural environment of economic activity [9, p. 127].

Despite the high level of literacy and solid basic knowledge of the majority of graduates, in Ukraine the system of education, training, retraining and advanced training of employees does not provide the qualified staff [10]. To ensure the success of workers and employers in the modern economic environment, promotion of development and competitiveness of enterprises, staff training should include the following components: 1) a combination of cognitive skills, such as literacy and mathematical abilities; 2) social and emotional skills such as responsibility and creativity; 3) technical skills and abilities required for a certain type of activity.

In terms of dynamic changes taking place in the modern world, as well as rapid development of digital economy, productive employment can be ensured by simultaneous formation of professional and career responsibilities. New economy requires a person to become a bearer of various new features, so-called Soft Skills such as readiness to cooperation and support, culture, communication, willingness to work in team, psychophysiological readiness to work in modern informational environment, ability to learn and train, goodwill to changes and innovations and so on [11]. The system of education should pay great attention to the formation of such personal qualities as resistance to stress, emotional stability of people, confirmatory determination of the central role of personal resources, self-responsible position in relation to professional and economic choice, capability of people to repeatedly change the scope of application of their own business and personal potential during their life [12].

Sustained development of economy requires a multifunctional labour force, which is also flexible and mobile, capable of learning and continuous updating of received knowledge, perception of technological innovation, development of new specialties, availability of stable motivational orientation to the increase of professional level, and, consequently, labour productivity. At the macroeconomic level, the growth of labour productivity determines the dynamics of GDP, ensures the growth of purchasing power of population, becomes an effective mean for the easing of inflation and a main source of implementation of measures aimed at social development and the enhance of population living standards [13].

In 2017 the program of government statistical monitoring involves working out methodological provisions by the State Statistics Service of Ukraine concerning calculation of labour cost index as part of adjustment of methodological and organizational provisions for carrying out the enterprise surveys on questions of labour reward and labour cost statistics in compliance with EU standards, introduction of statistical information and productivity statistics by the Ministry of Economic Development and Trade and the State Statistics Service of Ukraine within the framework of promoting the further development of cooperation among the manufacturers [14].

Since 2013 my attention in the articles has been focused on the reasonability of introducing the practice of comprehensive statistical analysis of labour productivity in the system of state statistical institutions, as well as involvement of an appropriate indicator into reports together with the recommendations to consider this indicator at all levels of management hierarchy [15]. Due to the representative questionnaire survey of the citizens of working age in the Chernihiv region of Ukraine, among which the public sector employees at the age of 40-49 have made 26.9%, the employees of private enterprises aged 25-54 - 57.7% and the unemployed population at the age of 43-47 - 15,4%, the personal qualification level (knowledge, skills, communication, autonomy and responsibility) provided by the National Qualifications Framework [11] has been considered as 2-4 for 14.3% of the public sector employees, the level of 5-6 for 28.5% and the highest level of 9 for 43%; as for the employees of private enterprises - up to 1 or 3 level for 7%, up to 0,2 or 4 level for 13%, up to 7 level for 20% and up to 5 level for 27%; as for the most of the unemployed population - up to the level of 3.

In the report of the World Bank on «Skills for Modern Ukraine», released on June 8, 2017, it has been noted that it is important to improve the skills of Ukrainian employees in order to increase the productivity of the country and make it more competitive [10]. The country does not have enough employees with sufficient skills to meet the needs of the market, and, as a result, its enterprises are losing their customers, as well as access to markets and innovative opportunities.

The national social policy should focus on creating preconditions for the growth of motivational potential, labour mobility, labour and productive activity of national human resources; thus, instead of struggling to ensure minimum living wages for every member of society, it is necessary to establish proper conditions for the development of personal productive capacities and provide their effective implementation. After all, high level of job-satisfaction among people involved in labour and those who use its results will significantly contribute to sustained, comprehensive and stable economic growth and improvement of human life.

The priority directions of the use of state investments, legislative and organizational opportunities to support creation of working places in Ukraine should be the types of economic activity, the development of which directly determines the level of economic security of the state (fuel and energy, agricultural and industrial complex); accumulating a large export potential (aircraft and shipbuilding, metallurgy, chemical and petrochemical industry); having a rapid turnover of capital (light, food, microbial industry, trade, some branches of agriculture); creating the material and technical base of production (mechanical engineering, especially energy, electric and technical sector and electronics, construction and building materials industry); promoting creation and operation of industrial and commercial infrastructure (transport and communications, scientific, technical and financial engineering); being oriented to meet the immediate needs of population (housing, municipal economy, medicine, education) [16].

Among the promising directions in the development of Ukraine the experts have pointed out [17]:

- development of agrarian infrastructure, water logistics, storage systems and biofuel production, etc. as for traditional specialization of Ukraine in agricultural industry due to the favourable weather conditions, black soils (chernozem), population growth of the planet and, accordingly, further demand for food products;

- the growth of national IT business, which is less dependent on political conditions and more - on human capital (we are ranked the first in Europe by the number of certificated specialists), and which is already working for a foreign customer on almost 100%, thus showing an increase of 30-35% annually, while the investments in national start-ups of this segment have exceeded 240 million USD over the past five years, much higher than the following average indicator in the Eastern and Central Europe;

- development of renewable and alternative energy, especially in the framework of rising costs of resources and an attempt to follow European energy saving tendencies;

- the growth of private medical sector, as it is in all developed countries, and manufacture of a wide range of pharmaceuticals based on the latest global formulations, due to the pan - European aging population tendency and the availability of Ukraine's potential to build up productive capacities, skilled human resources, relative unemployment of the market, state support programs for pharmaceutical business;

- reorientation from the industrial and raw material structure of economy to the sector of services, where small and medium-sized enterprises within a wide range of services will appear, together with the preservation of present proportion, since the services now account for about 70% of GNP.

Reserves for improving the labour productivity in Ukraine [18; 3]:

- solution of the problem of redundant number of workers at state-owned enterprises, the overwhelming majority of which are not functioning effectively;

- introduction of preferences when creating new working places, encouraging self-employment of population and conduction of business activity;

- restructuring of employment in order to increase the share of innovative labour, which implies the need for systematic growth of labour productivity in contrast to employment in low-productive forms of economic activity;

- implementation of preferential taxation and depreciation policy;

- fixed assets of innovative enterprises;

- the growing importance of intensive levels of economic growth, which will reduce the share of material costs within operating activity expenditure;

- encouraging employers to introduce energy-saving technologies and technical innovations in order to increase the share of labour costs in the structure of operating expenses;

- unshadowing of the economy, counteraction of the shadowing of incomes, etc.

Ukraine cannot live on foreign loans only. For external debt at the level of 91% of GDP, the policy of lending will lead to impoverishment of the population and put future generations in a debt pit [19]. Among other urgent measures, it is equally important to focus on improving the quality of education, employment growth and labour productivity. Two main factors are quality of education and quality of labour. Working out and adoption of new obligatory educational standards, in accordance with international standards, will stimulate improvement of the quality of education. The lack of compulsory educational and professional standards, in accordance with international standards, has already led to the fact that, despite the 30th place out of 187 in the world education rating, even by covering the majority of the population with primary, secondary and higher education, Ukraine is distinguished by one of the lowest levels of labour productivity and compensation.

Improvement of productivity and hence economic growth will be facilitated by the implementation of professional standards and their compliance through the creation of the National Centre for Professional Qualifications, the tasks of which are development of new professional standards, independent assessment of the qualification of employees, certification of specialists of different professions and qualifications in accordance with international professional standards.

The absence of the centre of labour productivity means a lack in the possibility of comparative assessment of productivity of individual enterprises in the industry and in various sectors, which leads to the incorrect salary balance in various spheres. Creating the Centre of Labour Productivity in Ukraine will form a basis for monitoring and analysing the labour productivity. Availability of comparative data on labour productivity in industrial sectors could serve as a benchmark for the structural reform of the country's economy, including development of new types of economic activity.

References

trend economic prediction

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