UNEMPLOYMENT PREDICTED TO SURGE IN RUSSIA
The Commonwealth of Independent States faces a sharp rise in unemployment this year, according to the United Nations International Labor Organization.
The ILO's expert on the former Soviet Union, Guy Standing, foresees the loss of at least 15 million jobs by year-end. Another 30 million workers are unneeded, Mr. Standing adds, though he doesn't expect the government to lay them all off, for fear of social upheaval.
"This figure, 15 million, is conservative," says Standing, who oversaw what he calls the most detailed survey of Russian labor ever. "It does not account for measures being considered by the government, such as going to world prices in energy and forcing unprofitable enterprises to close."
Unemployment in Russia is now at 7 percent, or 5 million of its 75 million workers. Standing expects joblessness to rise to 15 percent, or 11 million people. Most of the unemployed are not receiving benefits. Seventy percent of them are women.
At the 500 Russian factories visited for the survey, managers reported overstaffing by 25 percent and a drop in production to 70 percent of capacity. Enterprises already can't meet payroll, and will soon have to lay off workers, Standing says.
A shoe factory he visited in St. Petersburg was due to get 2.5 million rubles from the central government for payday, but had only received 300,000 rubles. The factory manager told Standing that management was already foregoing its pay.
Over the last two to three years, employment in the former Soviet Union has fallen by only 1 to 2 percent, Standing says. To avoid layoffs, enterprises retired older workers, reduced hiring, and put workers on part-time status or unpaid leave. Meanwhile, income levels have declined 17 percent; 80 percent of the population lives below the poverty line.