Ukrainian construction companies are experiencing a steady staff shortage, with some vacancies remaining open for up to six months, Rauta CEO Andriy Ozeychuk said in an op-ed for Interfax-Ukraine.
According to him, in 2022-2024, wages in the industry grew by about 20% annually.
Companies are increasingly attracting women and older people, and are also considering hiring workers from Asia.
Rauta is a leader in the Ukrainian steel construction market and a member of the European Construction Industry Association. The company provides design, production, and installation solutions in accordance with current EU regulations. The company is licensed to perform construction works with medium and significant consequences (CC2, CC3). According to the Unified State Register, the owner of 100% of the company’s authorized capital is Andriy Ozeychuk.
The cost of construction in Ukraine has risen by 70% since the start of the full-scale war, according to Andriy Ozeychuk, chairman of the board of directors of the Ukrainian Steel Construction Center, in a blog post for the Interfax-Ukraine news agency.
In 2024 alone, the cost of building materials and services rose by 24%, which significantly affected the cost structure of new projects.
Rauta is a leader in the Ukrainian steel construction market and a member of the European Construction Industry Association. The company provides design, manufacturing, and installation solutions in accordance with current EU standards. The company is licensed to perform construction work with medium and significant consequences (CC2, CC3). According to the Unified State Register, Andriy Ozeychuk owns 100% of the company’s authorized capital.
The Ukrainian construction market grew by 20% in 2024 compared to the previous year, reaching about UAH 200 billion (EUR 4.6 billion), said Andriy Ozeychuk, director of Rauta, in his column for the Interfax-Ukraine news agency.
According to him, demand for new housing increased by 7% thanks to the state program “єОселя” (eHome), and the largest investments in the commercial real estate sector were concentrated in warehousing, manufacturing, and retail facilities.
The segment of reconstruction and protection of critical infrastructure accounted for about 20% of the market volume.
Rauta is a leader in the Ukrainian steel construction market and a member of the European Construction Industry Association. The company provides design, manufacturing, and installation solutions in accordance with current EU standards. The company is licensed to perform construction work with medium and significant consequences (CC2, CC3). According to the Unified State Register, Andriy Ozeychuk owns 100% of the company’s authorized capital.
Andriy Ozeychuk, Director of the engineering and construction company Rauta, Chairman of the Board of Directors of the Ukrainian Steel Construction Center Association
What does Regulation 305 provide for?
On January 1, 2023, the Law “On placing construction products on the market” came into force in Ukraine, implementing the provisions of EU Regulation 305/2011 and significantly changing the requirements for the safety and quality of construction materials. By January 1, 2026, all Ukrainian producers must fully adapt to the requirements of the new law.
Cabinet of Ministers Resolution No. 426 extends the law to almost all construction products, from fasteners to chimneys.
New declaration system in Ukraine
The main difference between the new regulation and the previous one, which has been in effect since 2006, is the reference to European standards for the production of construction materials. From now on, Ukrainian producers must declare that their products comply with European standards and bear full responsibility for their quality.
Previously, the quality of products was confirmed by certificates in accordance with Ukrainian standards or technical specifications, which allowed for low-quality products. It was enough for manufacturers to register their own TUs or obtain a certificate from an accredited organization, relieving them of much of the responsibility for the characteristics of materials.
With the adoption of the new law, manufacturers are required to issue declarations of conformity based on the requirements of harmonized European standards. They must also ensure continuous quality control in production and take full responsibility for the declared characteristics.
Benefits of implementing Regulation 305
– Improved quality of building materials. New requirements oblige manufacturers to comply with European standards, which guarantees a higher level of product quality and safety.
– Protection of consumer rights. The introduction of a unified quality control system and liability mechanism will provide buyers with clear selection criteria and tools to influence unscrupulous producers.
– Access to the EU market. Thanks to a unified certification system, Ukrainian companies will be able to export their products to Europe without additional testing and conformity assessment procedures.
– Transparency of the construction materials market. Declarations of conformity will have to be registered in the Unified State Electronic System in the field of construction, which will promote openness and trust between producers, consumers and government agencies.
Risks of implementing Regulation 305
– Increased competition. European producers will be able to enter the Ukrainian market freely without additional certification, which may put pressure on national producers.
– Closure of some enterprises. Companies with outdated equipment may not be able to meet the new standards, forcing them to invest in modernization or cease operations. According to expert estimates, this risk will affect no more than 1% of Ukraine’s production capacity and will not have a significant impact on the industry.
Changes in European legislation
On November 27, 2024, the European Union adopted a new Regulation No. 2024/3110, which replaces the previous Regulation No. 305/2011. It entered into force on January 7, 2025, with a 1-year transitional period. It was Regulation 305/2011 that was the basis for the Ukrainian law “On placing construction products on the market”.
The main changes of the EU Regulation 2024:
– Increased environmental requirements. Manufacturers are obliged to assess the life cycle of building materials and their carbon footprint, which will promote the reuse and recycling of resources.
– Introduction of digital product passports. The Ukrainian law partially takes this provision into account, as it requires registration of declarations in the Unified State Electronic System in the field of construction.
– Simplification of requirements for small and medium-sized businesses to provide construction products on the market.
– Strengthening market surveillance. The regulatory authorities have been given more powers to check product quality and mechanisms to quickly withdraw non-compliant products from the market.
Conclusion.
The transition of Ukrainian producers to work in accordance with the requirements of the new law is an important step in the EU’s approximation. The new rules will encourage businesses to improve their production processes and invest in modernization, which will improve product quality and expand opportunities for domestic producers in the European market.
Metal structures have great potential in reconstruction projects and will help speed up the process, Andriy Ozeychuk, Rauta director and chairman of the board of directors of the Ukrainian Steel Construction Center, told Interfax-Ukraine.
“Metal structures have a great potential for use in restoring infrastructure facilities, especially bridges, and protecting the energy sector,” Ozeychuk said.
According to him, partnerships with international companies will help to promote the development of the Ukrainian construction sector, and government orders can also stimulate the market.
“Ukrainian steel producers can be engaged by foreign companies looking for local producers to implement construction projects, as steel is the preferred material for construction in most EU countries,” he explained.
Programs to modernize logistics hubs, warehouses, and industrial zones, as well as the active construction of modular housing and social facilities using steel solutions, can also significantly increase the volume of the steel structures market. Businesses are ready to offer innovative products for such renovation projects, the EBA head emphasized.
In particular, the technology of frameless sandwich panel buildings, for which Rauta received a patent in 2024, allows for the construction of energy-efficient buildings in a matter of days. This solution can be used for the construction of individual residential buildings, prefabricated cold rooms and cold warehouses, as well as other one-story residential and commercial buildings, Ozeychuk said.
Rauta’s comprehensive airtightness solution allows building owners to save up to 30% on their operating costs. The technology is based on the use of Ruukki sandwich panels of the Energy series and takes into account all possible elements to ensure the airtightness of the structure.
In 2023, Rauta developed a technology for the construction of walls of multi-storey residential buildings using sandwich panels instead of masonry made of artificial materials, which allows to increase the area of sold premises by 4.5%, resulting in approximately 11% additional profit for the developer, the expert explained.
In 2024, the Ukrainian construction market in monetary terms increased by 6% compared to 2023 and amounted to approximately UAH 170 billion (€3.9 billion).
The main segments for investment in commercial real estate were warehousing and retail facilities. Kyiv and Lviv regions remain the most attractive for the construction of new buildings, as they have a large population and good location relative to major transport routes. In 2024, the total area of new commercial projects increased by 65% compared to 2023. The warehouse segment grew by 111% and the retail segment by 22%.
The vacancy rate in the office real estate market of about 25% has forced developers to slow down or stop the development of new projects in this segment. In Kyiv, most of the new business centers are facilities that were started before the full-scale invasion. In Lviv, despite the increased demand for offices, 75% less new office space was commissioned in 2024 than a year earlier.
In the commercial construction market, the hotel real estate segment showed the highest growth, up 182%. This is primarily due to the active development of resort real estate in western Ukraine.
The restoration and protection of critical infrastructure accounts for about 20% of the construction market.
Demand in the primary residential real estate market increased by 12% in 2024. One of the important factors behind this was the introduction of the eHouse program, which accounted for a third of loans to new buildings.
In 2024, the demand for solar power plants on the roofs of commercial buildings and roofs of private cottages increased significantly.
Between 2019 and 2024, the cost of construction in Ukraine doubled. At the same time, the cost of construction materials and services increased by about 24% over the past year.
There is a growing shortage of skilled construction workers in blue-collar occupations. For some positions, companies have to look for specialists for several months and sometimes train employees themselves.
The shortage of skilled workers and high inflation are forcing employers to raise salaries and introduce new employee loyalty programs. On average, salaries in the construction industry grew by 15% over the year, which also contributed to the growth in construction costs.
Construction companies are actively recruiting pensioners and women to perform work that does not require significant physical activity: construction equipment operators, drivers, welders, etc.
The staff shortage encourages Ukrainian companies to consider hiring construction specialists from Asia and Africa.
On January 1, 2023, the Law of Ukraine “On the Placing of Construction Products on the Market” (EU Regulation 305/2011) came into force, introducing a new market surveillance system to ensure the quality of construction materials. 2025 will be the last year when the old and new regulations will be in force in the construction sector. Starting from 1 January 2026, suppliers of construction products covered by this law will be required to draw up declarations of performance and register them in the Unified State Electronic System in the field of construction.
Starting from August 2024, amendments to the Resolution of the Cabinet of Ministers of Ukraine No. 314 allow foreign companies to construct facilities of consequence class CC2 and CC3 during martial law by submitting a declaration to the licensing authority. This opens up wide opportunities for foreign contractors to implement construction projects in Ukraine, especially those financed by international institutions.
For 2025, the Ministry of Communities and Territories Development of Ukraine has planned to update 7 DBNs and develop 80 standards aimed at implementing processes to optimize design and construction, including BIM technologies, as well as removing barriers to the application of Eurocodes.
