The growth of the minimal wage in Ukraine will increase unemployment.

In Ukraine in 2017 can be fired about 630 thousand people owing to increase twice the minimum wage. Such data are the national Bank of Ukraine in the inflation report.

“The total number of employees in the formal sector of the economy in 2017 will be reduced by 9% compared with the year 2016. The contribution of reduction by raising the minimum wage will amount to 5.4 percentage points, or about 630 thousand people”, – emphasized in the NBU.

First, the decline in employment will occur at the expense of small and medium enterprises and natural persons – entrepreneurs because of the growth in single sotsvznosa predict the NBU.

In General, according to NBU estimates, employment will be reduced by 5% points compared with the year 2016, which would correspond to 10% unemployment.

Recall that the same inflation report national Bank notes that the slowdown in inflation in Ukraine “slow down” due to the increase in the minimum wage.