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Russia's New (Middle) Class Struggle

A building block of democracy, white-collar workers feel blue. The high life ends. Rsums flow.

The worst of Russia's financial panic appears to be over. But T.G.I. Friday's is keeping its "anti-crisis menu."

The restaurant still offers smaller portions and prices pegged to the dollar because many customers have not returned a month after the ruble collapsed.

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Russia has seen food lines, hyperinflation, and a collapsed currency before. But this crisis has knocked not only the poorest but the new middle class.

The lost patrons of places like T.G.I. Friday's had tastes for things American beyond Cajun chicken. They embraced a capitalist mentality after the Soviet Union's demise in 1991.

They opened bank accounts instead of hiding money in closets. They vacationed in Spain, wore designer jeans, and read computer manuals in English. They started businesses, chatted on mobile telephones, and ate in fashionable restaurants.

Although found mainly in big cities, they were an important step in Russia's transition to democracy.

Now they're broke. Their bank accounts are frozen, and they're worried about losing their jobs.

The ruble has rebounded somewhat, a political power vacuum has been filled with a new prime minister, and Muscovites are no longer hoarding food. But the middle class is making new plans.

"I think about making lifestyle changes now that I'll spend more money on food," says Alexei Burtzev, who epitomizes the twentysomething business class whose very existence is endangered.

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The computer-software company Mr. Burtzev started two years ago has seen turnover fall from $12,000 a month in July to $3,000 now. He is thinking of laying off one of his 10 employees. He frets about losing access to funds as his bank goes bankrupt and having to cancel a trip to America.

Dozens of shops, cafes, and kiosks have closed. Discos are empty on Saturday nights, or closed temporarily. Recruitment agencies report streams of jobless bankers, humbly shuffling in with rsums looking for work.

The biggest victims are from the sectors that arose from the ashes of communism - bankers, insurance salesmen, travel agents, advertisers, stockbrokers, accountants.

"Our white-collar workers will now have to change their collar color to blue," says Vladislav Sedlenek, vice president of Triza recruiting company.

The number of rsums appearing on his desk has doubled to 600 a day since the ruble was devalued on Aug. 17. Half of them are from people who still have jobs, but fear they won't much longer.

Mr. Sedlenek estimates that financial companies are dismissing 60 percent of their staff and that marketing and public relations companies are letting go 70 percent.

Maybe half of commerce companies have been stricken, because their imports are frozen due to uncertainty over the exchange rate, he says.

The impact is more devastating for Russians, say social scientists, than the 1987 stock market collapse in London was for British yuppies, although thousands lost their jobs. This is because Russia's new middle class was a fragile phenomenon, which had too little time to take root.

It now may be wiped out forever, says Vladimir Andreyenkov, who heads the Center for Comparative Social Research, based in Moscow.

"The middle class only began to emerge in 1992. Its formation period was too short," he says.

According to the Moscow city government, the full effects of the crisis have yet to be felt, because many companies gave dismissed workers two months' notice.

The number of officially unemployed in Russia's capital will rise from 35,000 currently to 50,000 by the end of the year, gloomily predicts Andre Grinburg, spokesman for Moscow's Employment Department.

"Over the last two weeks, 200 companies informed us they will sack about 5,000 persons by the end of the year," he says. "About one-fourth are from banks."

As in wartime America, one area that seems to be thriving is the cinema.

The ticket saleswoman at the theater downstairs from T.G.I. Friday's reports that the crowds seeking distraction are not deterred by doubled prices.

"Crisis? No effect," she says.

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