The Central Bank of Russia is closely monitoring the country's labor market in the current conditions and wants data as quickly as possible to make monetary policy decisions in the context of the unprecedented crisis, Governor Elvira Nabiullina said, quoted by Interfax.
“The current situation is unique in the labor market. Never in the modern history of Russia have we experienced such a labor shortage. We have never had anything like this, and this has an impact on the entire economic situation and on our decision,” the governor of the Central Bank of Russia said on Tuesday at the Alfa summit organized by the Russian business environment.
“Here, of course, if we had more up-to-date data, it would help us a lot,” Nabiullina pointed out, referring to the fact that Rosstat, the Moscow-based statistics institute, only publishes labor force data for the previous month at the end of the following month.
For example, data for March is due to be published on April 29.
Maxim Reshetnikov, Russia's minister for economic development, said on Tuesday that Russia's “talent pool” was “virtually exhausted” and finding new resources in the current domestic market conditions “will be extremely difficult.”
Russia needs to increase the productivity of existing workers
The minister added that, under the current conditions, the most important objective will be to stimulate productivity growth among existing workers. Reshetnikov said this could be facilitated, among other things, by changes in Russian legislation.
Earlier, he stated that the situation of the Russian economy is currently more difficult than in recent years. Analysts at consulting firm FinExpertiza, the official auditor of Russia's Central Bank, have estimated that the country's talent pool has shrunk by about three million people since 2021, the year before the war in Ukraine broke out.
Although Russian economic officials almost never cite front-line losses as a reason for labor problems, independent analysts have pointed out that they are exacerbating long-standing problems caused by Russia's sustained demographic decline.
Other factors that aggravated the problems for the Russian economy were the so-called brain drain that broke out immediately after President Vladimir Putin announced the partial mobilization in September 2022, but also the needs of the war economy, with the big players in the armaments industry attracting workers in large numbers from the rest of the productive economy.
Measures to restrict labor migration have not helped Russia either
Another major issue concerns the restriction of conditions for entering the country and granting work permits for foreign workers.
Millions of people from the former Soviet republics of Central Asia have immigrated to Russia in recent decades, becoming indispensable to the Russian economy.
But the rhetoric in Russia towards migrant workers has hardened dramatically since the March 2024 terrorist attack at the Crocus City Hall concert hall in Moscow, one of the bloodiest in Russian history.
More than 10 people, including the 4 alleged attackers, have been arrested in Russia in connection with the attack. Most were ethnic Tajiks of the Muslim faith who had lived and worked in Russia for years. Some of them held Russian citizenship.
A little over a week after the attack, President Vladimir Putin called for a “radical change” in Russia's immigration policies.
He also warned, during a meeting with Russian police chiefs, that the attack was intended to sow discord, xenophobia and Islamophobia in the country.
