The iron and steel industry of Ukraine is going through one of the most difficult periods in its recent history. In addition to general economic problems, the industry is experiencing a severe shortage of personnel, which averages 20%. This figure is critical for the stable operation of enterprises, which are not only major taxpayers but also areas of man-made risks.
Serhiy Bilenkyi, head of the Federation of Metallurgists of Ukraine (FMU), spoke to GMK Center about the labor shortage, salaries, staff retention, and working with veterans.
The industry is currently in one of the most critical situations in its recent history. The occupation of territories where production assets are located, the physical destruction or demolition of enterprises, the relocation and mobilization of key personnel, unfavorable price conditions in sales markets, high prices and tariffs for electricity, energy carriers, transportation, disconnection of enterprises from electricity supply, virtually closed external financing, limited opportunities for domestic investment, CBAM – this is a basic but not exhaustive list of risks that negatively affect the financial condition of the industry.
Since the start of the full-scale invasion, all iron and steel companies have been generating losses or, in certain more favorable reporting periods, operating at near-zero profitability. Under such conditions, it is difficult to talk about any significant increase in salaries.
According to the results of last year (from December 2025 to December 2024), the average salary at FMU enterprises increased by 7% to UAH 29,200 with inflation at 8%. Of course, this is far from the level of salaries that can be confidently called competitive. Companies in the industry are aware of this and plan to raise salaries as soon as they have the financial means to do so.
– Iron and steel companies have traditionally offered substantial social packages to their employees. Unfortunately, some of these additional incentives had to be suspended during the war. Voluntary health insurance programs for employees and their families, support for military personnel during and after mobilization, assistance to families of deceased and wounded defenders, assistance in connection with family events, assistance to internally displaced persons, assistance with the repair of housing damaged during shelling, organization of free transportation to and from work, training and professional development programs, and psychosocial support.
Staff shortages are one of the main problems facing the industry today. It takes years of training and practical experience to prepare a qualified specialist. We understand and support the state’s need to mobilize personnel, but objectively, we often have no one to replace the employees who have gone to defend the country.
It is difficult to give an exact figure, but on average, the shortage in the industry is about 20%, which is already critical for the stable operation of enterprises.
I probably won’t surprise anyone when I say that the possibility of deferring mobilization through the reservation mechanism is currently the main incentive for retaining key specialists. Our companies are actively working with the necessary specialists who have IDP status: helping with relocation, renting accommodation, etc. Thanks to this, we have managed to retain some of the key personnel who worked at enterprises located in the temporarily occupied territories.
During the full-scale invasion, between 20% and 30% of employees in the industry were mobilized. If we count from 2014, the percentage is even higher by a few percentage points. Replacing mobilized employees is one of the main problems facing the industry today, and it is becoming more difficult to solve with each passing day of the war.
The personnel reservation system is indeed constantly being improved. For the sustainable operation of enterprises in the industry, the current limit of 50% of reserved employees is objectively insufficient, primarily due to the relatively long period of training qualified specialists and the already exhausted possibilities of attracting employees from other industries.
We propose another specific solution: a mechanism for continuous (“seamless”) reservation without gaps between cycles, when the current reservation period for an employee has already expired and a new one is still being processed. During these few days, our key employee may be mobilized, which exacerbates the personnel shortage.
This is a very painful question. Unfortunately, since 2022, the number of people employed in the industry has been rapidly declining. At the beginning of 2022, 122,000 employees worked at our enterprises, including temporarily occupied territories.
During 2025, the average number of employees at FMU enterprises decreased from 66,000 to 62,000. In other words, during the full-scale invasion, the number of personnel in the industry almost halved.
In mid-2024, Poltava Mining employed nearly 4,500 workers, while Ingulets Mining employed 3,700. Not all of these employees are currently completely unemployed, as certain tasks are still necessary to maintain the enterprises’ operations. KZRK is not part of the FMU, so I do not have any data on this enterprise.
Yes, there is no other way to describe it. Layoffs have indeed begun. This applies not only to ArcelorMittal Kryvyi Rih, whose management has repeatedly warned the authorities that it will be forced to resort to such extreme measures if the issue of adequate electricity prices and stable supply to the enterprise is not resolved.
The entry into force on January 1, 2026, of the climate protectionist CBAM mechanism, which domestic exporters had hoped would be postponed, was clearly the catalyst for this decision.
Extremely negative. A very telling example is the city of Horishni Plavni, with a population of over 50,000, which is completely dependent on the work of Ferrexpo’s mining and processing plants. It is a very pleasant and comfortable city to live in, which stands out favorably from most other industrial regions. Unfortunately, if the mining and processing plants do not resume operations, this city will obviously face decline.
This is very important work. It is primarily thanks to our veterans that we are able to discuss the very existence and further development of the industry today. Virtually all iron and steel companies have created entire ecosystems for working with demobilized veterans with the aim of reintegrating them into civilian life and work. Best international practices have been used and unique experience has been gained.
For the most part, systematic work with veterans involves psychological screening after returning to work and appropriate psychological rehabilitation or psychocorrection programs.
Companies provide their veterans with various types of medical, economic, legal, and social assistance, and support veteran communities and volunteer movements.
Yes, systematic psychosocial support programs for employees have been implemented in the industry. They provide free consultations with psychotherapists for employees and their family members. The best civilian, military, family, and child psychologists are involved in this work, providing professional advice and recommendations. During the implementation of these programs, thousands of consultations have been conducted at enterprises in the industry, which attests to their quality and demand.
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