MONETARY FACTORS AND FISCAL CONSEQUENCES OF FLUCTUATIONS IN THE LABOR MARKET OF UKRAINE

Abstract

The influence of monetary policy instruments on the functioning of the domestic labor market and the fiscal consequences of taxation of wages of employees are determined. The main trends of the labor market of Ukraine before the full-scale invasion of the russian federation and under martial law are established. It is proved that as a result of unemployment, the country incurs significant financial losses, losing revenues to budgets and social funds, retaining the unemployed and compensating them for losses in income for the period of searching for new jobs. The unemployment rate in Ukraine and in European countries is compared. The dynamics of the average monthly wage by sectors of the economy and the relationship between its size and the activity of the application of the mechanism of bank lending by business entities is considered. It is determined that the largest volume of bank lending is used by business entities engaged in wholesale and retail trade, as well as industrial enterprises. The average interest rate on new loans for business entities in 2023 is presented and it is emphasised that by changing the discount rate, the National Bank of Ukraine directly affects short-term rates in the money market, stimulating or restraining the creation of new jobs. It is proved that the systematic use of credit funds by the real sector of the economy has a positive impact on the financial aspects of the domestic labor market, allowing to increase the level of wages. At the same time, the subjects of the intellectual economy and the financial sector provide a high level of wages, using bank loans only occasionally. In turn, a consistent increase in the level of wages has positive fiscal consequences, as it generates an annual increase in the amount of personal income tax mobilised to all levels of the budget system of Ukraine. It is confirmed by calculations that the key fiscal role in the revenues of this tax to the budget is played by the tax paid by tax agents from the income of the taxpayer in the form of wages. It is substantiated that the adaptive shocks of labor supply and demand in 2022 caused by massive external and internal migration are gradually levelled, and business and the population adapt to new realities.