The long-lasting economic impact of Ukraine's diminished population after war

The ongoing war in Ukraine has led to a significant population decline, with many refugees considering settling permanently in other European countries. This poses a challenge to rebuilding the Ukrainian economy once the conflict ends, as a shrinking workforce and labor shortage are expected to persist for years. The majority of displaced Ukrainians express a desire to return home eventually, but studies show that this desire tends to fade over time. The loss of educated young women, who are more likely to have left the country since the war began, exacerbates labor shortages in industries requiring higher levels of education and training. The population decline and labor shortage also have long-term implications for consumer demand. The Ukrainian government estimates that the population in areas controlled by Kyiv could already be as low as 28 million, down from a pre-war estimate of 41 million. Depending on the duration of the conflict and the number of people settling abroad, Ukraine's population is projected to decline further by 20-30% over the next 30 years. The economy could lose 2.55%-7.71% of its GDP per year due to the loss of Ukrainians settling abroad.