War effects on the labor market: corporate employment, productivity, and wages in Ukraine

This study examines the effects of the russia's full-scale invasion on the Ukrainian corporate labor market. We use the DID technique to analyze a panel data set of over 100,000 firms linked to geolocation and industry data spanning 2021-2024 and show how war harms the corporate labor market in Ukraine. Specifically, our findings evidence that destructive military shocks adversely affected the number of employees hired, productivity, and wages paid in the corporate sector. We emphasize that the war effects are heterogeneous across firm size and labor intensity and depend on external debt and bank financing. The results obtained have considerable policy implications, making them valuable to both researchers and policymakers.