“Competitiveness of regional labor markets as a determinant of international migration: A nexus empirical study”

A large-scale migration from Ukraine caused by russian military aggression has triggered new security challenges to the national and regional economies. The paper aims to assess the competitiveness of regional labor markets and examine its nexus with international out-migration (on the example of the Carpathian region of Ukraine). The research methods include a composite approach (assessment of labor market competitiveness), the theory of sensitivity (identification of degree of sensitivity of composite and partial indices to changes in indicators), nonlinear regression (determination of dependence of the international out-migration on labor market competitiveness), and econometric nonlinear optimization (calculation of critical values of migration). The information and analytical basis comprises indicators reflecting the development of labor markets and international migrations in the oblasts of the Carpathian region in 2008–2021. The study reveals that the level of labor market competitiveness in the region mainly remained below the national average. Two groups of indicators dominated the structure of composite indices of labor market competitiveness in the region’s oblasts: institutional capacity (indicators measuring the ability of regulatory institutions and labor market entities to provide adequate support to the unemployed and promote employment) and labor motivation (wage and income indicators). Only Lviv oblast demonstrated resilience and growth of competitiveness, which was reflected in moderate out-migration. Meanwhile, the intensity of international out-migration in Zakarpattia and Chernivtsi oblasts (with worse labor market parameters) exceeded the estimated critical values. The paper confirms that low competitiveness of the labor market is a factor increasing migration losses.


INTRODUCTION
Ukraine is in an active phase of the fight for its independence and place in the global economic and political space.Deep destructive transformations are taking place in the resource markets, especially in the labor and capital markets.Overcoming the negative consequences of migration losses of human resources and preventing a critical intensification of these processes has been an important front in the war against russia since 2014.Building a competitive labor market and providing effective employment as part of a new strategy for economic competitiveness in line with the National Recovery Plan of Ukraine should be a key priority (Recovery of Ukraine, 2022).These prerequisites create an urgent need to study the competitiveness of the labor market, explain its component structure, and justify the importance of the labor market in shaping a competitive economy resilient to modern challenges.

LITERATURE REVIEW
The concept of labor market competitiveness is not well-established in the international academic literature.It is most often studied in terms of its components: labor force, jobs, and working conditions.Accordingly, there is no clear theoretical and methodological understanding of the concept under study.However, some Ukrainian scholars operate with the category of labor market competitiveness and try to find a comprehensive methodological approach to its assessment.In Ukraine, the systemic and structural aspect of this issue is developed by Libanova (2007), who considers this category through the competitiveness of jobs, labor force, and their qualitative and quantitative balance.Semykina (2008) and Shylovtseva (2019) emphasize that the country's competitive advantages in the labor sphere directly depend on the accumulation of a "critical mass" of competitive employees capable of highly productive and cre-ative work, creating innovations and new knowledge, providing services quickly and efficiently, and making optimal decisions in accordance with market demand.The imperatives of achieving high labor productivity (Petrova & Blyznyuk, 2018), ensuring decent wages, and implementing the principles of inclusive development (Blyznyuk, 2020) are important for increasing the competitiveness of the labor market and the economy.
A number of scholars consider the competitiveness of the labor market through the capacity for economic growth due to the efficiency of human resources, their quantitative and qualitative parameters, and the flexibility of the labor market (Scharle, 2003).Others view the growth capacity of specific industries and sectors (spheres) of the economy in the context of internal and external competition (Porter, 2008) and the possibility of attracting investors capable of creating new jobs and innovative renewal of the production appara-tus (El-Ehwany & Metwally, 2001).Thus, there are two conceptual approaches to studying the problems of labor market development and its status in competitive relations.The first approach lies in studying the competitiveness of the labor force, jobs, and labor costs while limiting itself to the labor market conditions.While the second one considers competitiveness much more broadly -not only in the microeconomic context but also in the systemic macro context, where the labor market ensures the competitiveness and resilience of the entire economic system.
The synthesis of both approaches implies an understanding of labor market competitiveness as the ability of the labor market, as a complex system of social relations and connections, to compete for the internal and external human resources of the state (region) due to a high-quality competitive environment that shapes the labor market and efficient state regulation.It is important to add that a competitive labor market should ensure migration security and economic growth capacity.At the same time, migration security should be understood as the state of protection of national interests and territories (regions) in the field of migration from the impact of potential and actual threats that lead to an increase in migration losses.
Empirical experience in this area is represented by the following studies: Goto (2008) (analysis of the competitiveness of the formal and informal sectors of the labor market, their nexus with poverty), Obadić (2004) (study of labor market competitiveness in individual countries based on key macroeconomic indicators), Ibarra-Cisneros and González-Torres (2010) (assessment of labor flexibility as a strategy for ensuring competitive advantages of the labor market), Kim et al. (2022) (empirical confirmation of the possibility of minimizing the costs of social insurance programs financed by payroll taxes in a competitive labor market), Wołowiec (2003) (analysis of the labor market impact on the competitiveness of the economy based on the share of labor costs in the GDP structure), and Wojciechowska (2018) (competitiveness of the labor market in the context of professional activity, mobility, and labor costs; security component in terms of local, regional, and supranational (EU) challenges for the Polish labor market).
Given that migration is mostly a consequence of changes in the quality of life caused by social (security and safety) and economic (employment, income, and well-being) factors, the interrelations and interactions between the competitiveness, functioning and development of regional labor markets, on the one hand, and the dynamics of migration, on the other, are most often studied in terms of job dissatisfaction and forced migration (Falk et al., 2011;Ruiz & Vargas-Silva, 2013), long-term implications of migration and problems of destabilization of labor supply and demand (Sarvimäki et al., 2009), social and labor conflicts and migration aspirations of workers (Kondylis & Mueller, 2014), social skills in the labor market and migration intentions (Deming, 2017), intensification of migration due to structural imbalances in regional labor markets (Mulska et al., 2022;Semiv et al., 2021), the strengthening of pushpull factors of the population (Levytska et al., 2020;Mulska et al., 2020;Mulska et al., 2021), and the state policy of structural reform of established labor markets to rethink the tasks of their resilience in accordance with changes in the volume and structure of internal and external migration (Long, 2014).
In the context of the long-lasting russian-Ukrainian war, the processes of so-called transnational migration have intensified.The consequences of the war have become the dominant cause of massive forced displacement in Ukraine.However, many decisions were also made in accordance with the physical safety of the stay, the current situation in the labor market, and employment opportunities.The issue of transnational migration has been repeatedly raised in studies on the critical imbalance of labor markets in the context of wars and environmental, social, and other instabilities (Carling et al., 2021;Guarnizo, 2003;Levitt & Jaworsky, 2007;Privara, 2022;Rahimli, 2021;Zembylas, 2012), which emphasize the scale of migration as a social phenomenon resulting in migrants becoming more than just the community and creating new social networks that cross the borders of states and continue to function in global social networks.However, the specifics of the war in Ukraine necessitate more profound research in this area, particularly considering the peculiarities of the competitiveness of Ukraine's regional labor markets and its impact on migration, and the future intentions of Ukrainians, including transnational ones.
Integral assessments of labor market efficiency are widely used in international and interregional comparisons, in particular when compiling the EU regional competitiveness ranking (EU, 2022), assessing regional competitiveness at the level of individual countries (Huggins et al., 2023), and in special studies, such as the assessment of Malaysia's labor market competitiveness (EU-ERA, 2022), which is based on 44 indicators of labor supply and demand and market efficiency.
International rating assessments frequently adjust the methodology and criteria used in calculating composite indices, depending on changes in socio-economic policy and its course or the emergence of new macroeconomic challenges.However, there is a national specificity in the selection of methods and tools for conducting these assessments, which, in turn, is the main reason why they are not extensively used by other countries.
Ukraine has also developed methodologies for a comprehensive assessment of regional competitiveness, which include the regional human development index and the regional competitiveness index based on monitoring the socio-economic development of regions.In both studies, labor market efficiency indicators related to income, employment, unemployment, unemployment benefits, professional training, etc. are crucial integral indicators.However, these methods have the disadvantage of being unchangeable in the dynamics of the weighting coefficients of indicators (their groups), a limited number of criteria by which regional labor markets are assessed, and fragmentation or inconsistency of indicators.Some authors attempt to address these methodological gaps by narrowing the focus of the analysis to a particular component of labor market competitiveness or a specific type of labor market (by territory, industry, sector, or other characteristics).For instance, Adamovska et al. (2022) analyze the motivational component of the competitiveness of sectoral labor markets in Ukraine, Rudenko and Lisohor (2021) consider structural changes in regional employment, while Pavlikha et al. (2018) examine the competitiveness of the labor market of the border region with a reflection on the migration caused by the situation in this labor market.
The most competitive regions attract skilled labor and investment, thus providing opportunities for innovation.Meanwhile, destructive processes in the employment and the labor market, such as shadowing, precarization, social devaluation, and imbalance, lead to the loss of human resources and, accordingly, the "leaching" of labor potential.Such processes are pushing people out and, as a result, reducing the competitiveness of the labor market.Consequently, there is a "transfusion" of resources and a change in the competitive position of territories, with migration becoming a factor in their development.This is confirmed by recent studies on the impact of international migration on the development of the UK economy and its individual markets (Bijak et al., 2019), the effect of demographic shift and migration on labor markets in OECD countries (Docquier et al., 2019), the projection of the impact of refugee migration on regional labor markets in Germany (Vanella et al., 2022), and the effects of migration on the economic development of Ukraine and Poland (Polkovnychenko & Salai, 2023).
New security challenges and new social and humanitarian crises have exposed empirical gaps in current studies, particularly in assessing the causal links between the parameters of labor market competitiveness in the regions and migration indicators, modeling their mutual influence, and calculating the threshold values of the given variables.
Therefore, this study aims to assess the competitiveness of regional labor markets and examine its nexus with the intensity of international out-migration (on the example of the Carpathian region of Ukraine).The paper elaborates on the following hypothesis: H1: Labor market competitiveness has a complementary impact on international out-migration intensity, which determines the extent of migration losses of the territory.

METHODOLOGY
The study applies the system-structural method to understand the content and components of labor market competitiveness, uses a composite approach to assessing the labor market competi-tiveness of the region and its components, adapts elements of the sensitivity theory to determine the degree of variability of composite and partial indices (sub-indices) resulting from changes in input indicators and their weighting coefficients, and applies the method of modeling the nonlinear dependence of international out-migration intensity on the level of labor market competitiveness and the method of econometric nonlinear optimization of the studied parameters.
The methodology for the composite assessment of labor market competitiveness in the oblasts of the Carpathian region is based on sensitivity coefficients and a multiplicative approach.The input indicators were systematized based on the fact that the structure of labor market competitiveness is primarily shaped by the following components: competitiveness of jobs and working conditions that determine the demand in the labor market, price, and non-price competitive advantages; competitiveness of the labor force that forms the supply in the labor market.Accordingly, 26 indicators were selected using the expert method and grouped into 5 categories (Appendix A): quality of jobs, intellectual-human resources, labor motivation, employment and labor market efficiency, and institutional capacity of the labor market. The where z s irt are the standardized values of the i stimulating indicator for the r region (oblast) in the t period (i = ̅ 1̅ , ̅ n; r = ̅ 1̅ , ̅ m); z d irt are the normalized values of the i de-stimulating indicator for the r region (oblast) in the t period (i = ̅ 1̅ , ̅ n; r = ̅ 1̅ , ̅ m) х irt are the initial values of the indicators (i = ̅ 1̅ , ̅ n;r = ̅ 1̅ , ̅ m); х minrt , х maxrt are the minimum and maximum values of the i indicator for the r region (oblast) in the t period (i = ̅ 1̅ , ̅ n; r = ̅ 1̅ , ̅ m).
Based on the standardization results, interregional comparisons are used to form a series of standardized indicator values (z irt ) for all regions within each particular year t.

Calculation of the weighting coefficients of in-
dicators in groups.Dynamic weighting coefficients of indicators within each group of indicators for the selected set of regions (oblasts) are calculated by the formula (3): where w it kr is the weighting coefficient of the i indicator in the k group for the r region (oblast) in the t period; μ i kr is the sensitivity coefficient of the i indicator in the k group for the r region (oblast) in the t period (calculated based on the correlation matrix); Δx it r is the coefficient of variation of the i indicator for the r region (oblast) in the t period.

Calculation of partial weighting coefficients of
indicators.The weighting coefficients of indicators within the k group of labor market competitiveness indicators are calculated using the formula (4): , where β it kr is the weighting coefficient of the i indicator in the k group for the r region (oblast) in the t period; z irt is the standardized value of the i indicator for the r region (oblast) in the t period.

Construction of group coefficients of labor
market competitiveness based on a multiplicative approach (formula 5): , where γ kt r is the group coefficient for the k group of indicators for the r region (oblast) in the t period.
where LMC t r is the composite index of labor market competitiveness for the r region (oblast) in the t period.The values of the composite indices range from 0 to 1.The growth of the index indicates an increase in the labor market competitiveness.
The intensity of international out-migration (MIGRoutEXT t r ) is calculated as the ratio of the number of people who have moved abroad (external migrants) from the r region (oblast) in the t time interval (M t r ) to the current population in the r region (oblast) in the t time interval (P t r ) and is expressed in permille: 1000, Nonlinear regression functions of the dependence of international out-migration intensity on the level of labor market competitiveness in the oblasts of the Carpathian region are obtained using the CurveExpert Professional software.The dependence is built based on a rational function (formula 8) and a 3-and 4-degree polynomial regression model (formula 9), the adequacy of which is confirmed by the relevant parameters of statistical significance of the results obtained at p = 0.05 (in particular, the coefficients of determination, standard error, and AIC).
where a, b, c, d, e are the model parameters.
Based on the modeling results, the range of optimal values of the composite index of labor market competitiveness to mitigate migration losses is calculated for each oblast of the Carpathian region.
Following the systems theory, the results of econometric nonlinear optimization are used to calculate the critical values (upper and lower thresholds) of international out-migration intensity in the oblasts of the Carpathian region.These values are used to identify the potential for maintaining competitive positions and resilience of the oblasts and the region as a whole.The calculations reveal that the integral level of the labor market competitiveness of the Carpathian region is below the national average, as its values in 2008-2021 ranged from 0.207 to 0.444 (over 14 years, the composite index increased by only 0.43%).Only Lviv oblast showed real resilience and growth (by 26.83%).Appendix B shows the final results of the composite competitiveness assessment for 27 regional labor markets in Ukraine.

RESULTS AND DISCUSSION
The weighting coefficients of the indicator groups calculated on the basis of sensitivity coefficients made it possible to assess the contribution of each group to the development of integral competitiveness in the spatial and dynamic aspects (Appendix С).Mostly the institutional capacity of the labor market and labor motivation were the dominant determinants of labor market competitiveness in the structure of the composite index.
The study also reveals that the Carpathian region did not stand out with high values of the sub-indices of indicator groups compared to other regions of Ukraine during the period under research (Appendix D).All five components of labor market competitiveness were at or below the regional average, except some growth in the job quality sub-index values since 2014 (mainly due to Zakarpattia and Lviv oblasts with their average annual growth of 25.5% and 8.8% against the regional average) and improvement in labor motivation since 2014 (due to Zakarpattia and Ivano-Frankivsk oblasts with growth of 68.9% and 32.9%).However, it is worth noting that labor market competitiveness increased in the oblasts of the Carpathian region to a large extent due to a sharp decline in the competitive position of the eastern oblasts (especially Donetsk and Luhansk oblasts) after the outbreak of war in the east of Ukraine in 2014.Meanwhile, before the war, the Donetsk macro-region had above-average values of subindices (especially in terms of employment and labor market efficiency) and final indices.
In recent years, prior to the full-scale invasion, there was an increase in international out-migration from regions of Ukraine with less competitive labor markets, which provisionally confirms the research hypothesis regarding the nexus between labor market competitiveness and emigration intensity.
In fact, Figure 1 shows that the intensity of international out-migration from the Carpathian region is increasing, although it remains mostly be- The rise in out-migration was triggered by political and economic instability and security challenges in 2014 and subsequent years by signing the visa-free regime agreement between Ukraine and the EU in 2017 and socio-economic stagnation during the 2020 pandemic, which escalated into the current war-driven crisis.Moreover, the expansion of official employment opportunities for Ukrainian citizens in the EU also explains the above-mentioned dynamics of out-migration over the period under study.
Based on the results of the economic and mathematical modeling of the dependence between the intensity of international out-migration and the level of labor market competitiveness in the oblasts of the Carpathian region, performed with CurveExpert Professional 2.6.3 software, nonlinear regression functions (based on 3-and 4-degree polynomial regression and a rational function) were constructed.The optimal values of the competitiveness of the studied labor markets, at which migration losses are reduced, are also calculated (Table 2).
The labor market in Zakarpattia oblast (for the period of analysis from 2008 to 2021) was unappealing to immigrants and provoked excessive migration losses of its own human resources.These losses were higher than the national average (see Figure 1).The economic growth rate in recent years has been insufficient to ensure the optimal level of labor market competitiveness in the oblast in the range of 0.3999-0.4652(the actual level of the composite index in 2021 was only 0.3305).Consequently, the intensity of international out-migration in 2021 surpassed the critical upper threshold (actual value -4.49‰, threshold value -4.12‰).High migration rates were facilitated by the signing of several bilateral agreements on local border traffic by Ukraine, which made it easier for the population of Zakarpattia oblast to travel to Hungary, Romania, Poland, and Slovakia.
Despite the relatively high migration activity of the population of Ivano-Frankivsk oblast (compared to other oblasts of the Carpathian region), international out-migration accounted for only 3.38% of the total migration from the oblast on average in 2008-2021.This means that the specifics of the Ivano-Frankivsk oblast's economy, with its low growth rate and low level of labor market competitiveness (0.2499 -composite index in 2021) work to "push" the population out of the oblast, Source: SSSU (2021).Threshold values of international out-migration (subject to compliance with the optimal range of labor market competitiveness) rate it into their long-term plans for EU-Ukraine economic cooperation.Accordingly, regional employment programs and plans in Ivano-Frankivsk oblast should be aligned with new economic priorities in developing the Ukrainian-Romanian border's capacity, thereby increasing the competitiveness of the regional labor market.
The results of modeling the studied variables on the example of Lviv oblast show that the intensity of international out-migration is sensitive to changes in the composite index of labor market competitiveness.Meanwhile, a significant growth potential of the index was identified.Its optimal limits were calculated in the range from 0.4345 to 0.6024, with the actual value of the index in 2021 at 0.4712.The oblast's migration capacity was also not exhausted before the full-scale war in Ukraine.The rate of emigration from Lviv oblast was approaching the upper limit in some years of the study period (2018-2019), even crossing the so-called "red line."In 2020, due to the pandemic, migration intensity began to decline and remained within the calculated optimal rate until 2021.The study also suggests that by the level of labor market competitiveness in Lviv oblast to the upper optimal value (0.6024), migration losses in the oblast can be reduced to 2.12‰.
Chernivtsi oblast significantly differs from other oblasts of the Carpathian region of Ukraine regarding out-migration.In fact, in 2021, the intensity of the outflow of human resources abroad from the region reached 5.17‰ (with an average value in the Carpathian region of 3.80‰ The optimal level of the labor market competitiveness index for Chernivtsi oblast, calculated based on economic and mathematical modeling, was in the 0.3021 to 0.4142 range.This means that to reduce international out-migration, the level of labor market competitiveness in the oblast should increase by 20-40%.
The obtained outcomes of the composite assessment of the regional labor market competitiveness largely correlate with the results of the ongoing monitoring of the socio-economic development of Ukrainian regions, which has been conducted since 2015 at the initiative of the Ministry for Regional Development, Construction, Housing, and Communal Services of Ukraine.The monitoring is carried out regularly to assess the effectiveness of the state regional policy.
Analyzing the efficiency of the labor market covers 6 key indicators: labor productivity, employment and unemployment rates, the ratio of new hires to retirees, the real wage index, and the amount of wage arrears.In 2016, the labor markets of Kyiv and Kharkiv, Odesa, Lviv, Kyiv, and Zhytomyr oblasts (in no particular order) were the most efficient (Ministry of Regional Development, Construction, Housing and Communal Services of Ukraine, 2017) and competitive according to this paper.The exceptions included Chernivtsi and Vinnytsia oblasts, which had high ratings solely in national monitoring results, and Dnipropetrovsk oblast, which ranked high in the assessment of regional labor market competitiveness.In 2021 (Ministry of Regional Development, Construction, Housing and Communal Services of Ukraine, 2021), Kyiv and Lviv, Dnipropetrovsk, and Kharkiv oblasts were the leaders in both surveys.
Despite the numerous scientific works on the impact of migration on the demographic and labor potential of territories, and thus on the efficiency of labor markets, the feedback (when the situation on labor markets is a factor in shaping migration) is currently being studied and tested for different types of dependence.The pattern of higher levels of migration from countries with low or insufficient labor market and employment development parameters identified in Germany (Privara, 2022) has been empirically confirmed in this study on the example of the Carpathian region of Ukraine.The German pattern is vital for Ukraine, as a large number of Ukrainian refugees (1.07 million people) left for that country during the war.The key criteria for the attractiveness of the German labor market include the level of state support (under programs for employment activation and market development), which is also proved by the high weighting coefficients of institutional capacity indicators for the labor markets of the Carpathian region's oblasts.
The results of the study confirm the assumption of a complementary relationship between labor market competitiveness and international out-migration, which determines the extent of migration losses of the territory.It is necessary, on the one hand, to consider the specifics of the environment of a particular labor market, which impacts the migration activity of the population, and, on the other hand, to monitor the impact of particular exogenous factors on the labor market environment, such as large-scale migration flows caused by the war.

CONCLUSION
The aim of the study was to assess the competitiveness of regional labor markets and examine its nexus with the intensity of international out-migration (on the example of the Carpathian region of Ukraine in 2008-2021).The study shows that the competitive labor market positions in the Carpathian region were below the national average.Only Lviv oblast demonstrated resilience and growth (by 26.83%), while the labor markets of Zakarpattia and Chernivtsi oblasts were mostly less competitive during the study period.It turns out that the level of international out-migration in these oblasts surpassed the critical values calculated by econometric nonlinear optimization, and the migration potential of Ivano-Frankivsk and Lviv oblasts was not exhausted.This confirms the hypothesis that oblasts with a higher level of labor market competitiveness are more attractive to local residents and immigrants (especially for highly skilled labor) and experience lower migration losses, which serves as the basis for regional migration security.
Therefore, the competitiveness of regional labor markets can be considered the most complex object of state regional policy.It requires considering the territorial specifics of job quality, human resources, motivational support, employment performance, and institutional capacity, as well as the strength of the impact of labor market competitiveness on migration (in particular, the international out-migration vector).The obtained empirical basis opens up new opportunities for adjusting the regional policy of employment regulation and labor market development.This issue is particularly relevant for Ukraine, given the new stage of the country's European integration efforts.Thus, it seems promising to study the mechanisms for increasing the competitiveness of regional labor markets to ensure the socio-economic convergence between Ukraine and the EU and accelerate the post-war recovery.

Figure 1 .
Figure 1.Intensity of international out-migration from the Carpathian region in 2008-2021, ‰

Table 1 .
Composite indices of labor market competitiveness of the Carpathian region of Ukraine, 2008-2021

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 21/08, %
Note: * based on the 24 oblasts of Ukraine, the city of Kyiv, the Autonomous Republic of Crimea (ARC), and the city of Sevastopol.Since 2014, it has excluded part of the temporarily occupied territories of Donetsk and Luhansk oblasts, and the temporarily occupied territory of the ARC and the city of Sevastopol (Appendix B).
low the national average.While this indicator (per 1,000 inhabitants) was declining in 2008-2012, starting in 2012 (except 2016 and 2020), there has been a steady upward trend.

Table 2 .
Empirical analysis of the international out-migration dependence on the labor market competitiveness on the example of the oblasts of the Carpathian region of Ukraine*

Optimal values of the labor market competitiveness
Mykhailyshyna et al. (2023)ite indices of labor market competitiveness (LMC t ) and the intensity of international out-migration (MIGRoutEXT t ) from the oblasts of the Carpathian region (time period: 2008-2021).Parentheses enclose standard error with the p-value of 5% significance.In 2022, the intensity of international out-migration increased dramatically in all oblasts of the Carpathian region due to the forced emigration of the population caused by the full-scale war in Ukraine: up to 91.2‰ in Zakarpattia, up to 34.1‰ in Ivano-Frankivsk, up to 81.8 ‰ in Lviv and up to 44.9‰ in Chernivtsi oblasts (based on the Centre for Economic Strategy Survey presented byMykhailyshyna et al. (2023)).