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Line 512: − + − − The Russian labor force is undergoing tremendous changes. Russia's labor force is largely mismatched to the rapidly changing needs of the Russian economy. Official unemployment has shrunken in recent years to 6.9%, and labor shortages have started to appear in some high-skilled job markets. Nonetheless, pockets of high unemployment remain and many Russian workers are underemployed. Unemployment is highest among women and young people. Following the 1991 collapse of the Soviet Union and the economic dislocation it engendered, the standard of living fell dramatically. However, real disposable incomes have doubled since 1999, and experts estimate that the middle class ranges from one-fifth to one-third of the population. In 2006, 15.8% of the population lived below the subsistence level, in contrast to 38.1% in 1998.{{fact}} − − ===== Productivity ===== − − ''See also:'' [[Russia's labor productivity]] − − On February 7, 2024, Reuters reported: − {{Cquote|According to Rosstat, Russia's labour productivity index, one of Putin's key national development goals, fell 3.6% year-on-year in 2022, its steepest annual fall since the aftermath of the global financial crisis in 2009. − − Labour Minister Anton Kotyakov has said Russia needs to increase labour productivity in order to become more technologically self-sufficient. − Labour productivity data for 2023 will not be published until late-2024, but the authorities' warnings about manpower shortages suggest there was no rebound in that figure last year.<ref>[https://www.reuters.com/world/europe/russias-gdp-boost-military-spending-belies-wider-economic-woes-2024-02-07/ Russia's GDP boost from military spending belies wider economic woes], Reuters, February 7, 2024</ref>}} − − The RBC Group, a Russian media group headquartered in Moscow, reported on December 4, 2023 in their article ''Experts estimate the level of Russian GDP losses due to personnel shortages'': − {{Cquote|According to experts, in order to eliminate the deficit, it will be necessary to achieve labor productivity growth of at least 2.4% per year - this is twice as fast as the historical level (the average rate over the last ten years is 1.2%) and higher than the forecast (for 2023-2026 it does not exceed 2%). Over the period since 2018, the maximum increase in productivity was observed in 2021 (3.7%), last year it fell by 3.6%. − − “The growing need for qualified personnel is most noticeable in the regions, especially if you pay attention to the increase in the proposed salary. It is worth noting that in the regions the proposed salary for qualified personnel is growing faster than in Moscow,” noted Vladimir Dzhuma, director of the Center for Digital Transformation and Data Analysis of the All-Russian Research Institute of Labor.<ref>[https://www.rbc.ru/economics/04/12/2023/656c83409a79471d72124f2d Experts estimate the level of Russian GDP losses due to personnel shortages], RBC Group (Translated from Russian to English)</ref>}} − − ===== Labor shortages ===== − − Full employment during the [[Special Military Operation]] has led to labor shortages. According to the Eurasian Research Institute: − {{Cquote|Depopulation, aging and shrinking number of the working-age population are some of the biggest challenges which Russian labor market face today. The year 1995 is an important year for demographic dynamics in Russia because after that year number of population continuously decreased and according to forecasts it will fall even further in the near future. The current problems could be solved by either natural or migration-based option. First, option refers to solve the issues of the labor market with increasing the natural growth of the population while the second solution advocates attracting a large number of migrants to Russia (Rosstat, 2016). However, total fertility rate of Russia is below sustainable growth rate indicating that Russian population will decline and consequently the number of working-age population will decrease. Moreover, the current level of the migration flow is not large enough to compensate the losses in the number of population and working-age population (World Bank, 2016).<ref>[https://www.eurasian-research.org/publication/the-future-of-the-labor-market-in-russia/ The Future of the Labor Market in Russia]</ref>}} − − The central [[US]] [[Deep State]] Center for European Policy Analysis (CEPA) [[think tank]] issued a report on Russia.<ref>[https://wikispooks.com/wiki/Center_for_European_Policy_Analysis Center for European Policy Analysis], Retrieved April 10, 2024.</ref> CEPA, an organization actively promoting [[LGBT]] [[propaganda]],<ref>[https://cepa.org/article/russia-a-state-of-homophobia/ Russia: A State of Homophobia], By Kseniya Kirillova, June 8, 2022. cepa.org</ref> is funded by the [[US military industrial complex]], [[Lockheed]], the [[CIA]] [[regime change]] outfit the [[National Endowment for Democracy]] (NED), [[Raytheon]], Smith Richardson Foundation, [[US Department of Defense]], the [[Biden]] [[State Department]], United States Institute of Peace,<ref>https://www.heritage.org/global-politics/report/the-us-institute-peace-politicized-and-unaccountable</ref> among others. The the report read: − {{Cquote|Towards the end of last year, experts from the Institute of Economics of the Russian Academy of Sciences estimated that [[Russia]] faced a shortfall of nearly 5 million workers in 2023, which is already impeding economic growth. The total workforce is a little under 74 million. − − With perhaps a million Russians, including many working-age men, having fled the country, with more than 300,000 dead or wounded in Ukraine, with more than a million men in the military, and a fertility rate of 1.5 — far below the so-called replacement rate of 2.1 — the country simply cannot meet its needs. − − The head of the Central Bank is among those describing it as the country’s most serious problem, hardly surprising when unemployment is just 2.9% and the vacancy rate is 6.8%. − − This scarcity is particularly pronounced in the manufacturing, construction, and transportation sectors. According to recruitment agencies and company management, the workforce deficit will worsen in 2024. − − Beyond skilled professionals, Russia struggles to meet even basic labor demands, including those for military purposes. Increasingly, schoolchildren and students are being enlisted for war-related tasks. Just last week, a major investigation revealed how minors as young as 14 are involved in activities for the “Mayor’s Labor Unit” in Krasnoyarsk, weaving camouflage nets and preparing parcels for frontline needs.<ref>[https://cepa.org/article/russia-seeks-africans-to-fix-its-workforce-shortages/ Russia Seeks Africans to Fix its Workforce Shortages], Center for European Policy Analysis, March 9, 2024</ref>}} − − ===GDP estimates in dollars=== − [[File:Russian GNP 1991 to 2023.jpg|thumbnail|right|300px|Estimates of Russian GNP 1991 to August 2023 measured in [[US fiat dollars]]; exchange rates between the dollar and the ruble ended in March 2022 when the ruble became [[gold standard|gold-backed]].]] − A strong expansion in domestic demand continues to drive GDP growth, despite a slowdown in manufacturing. GDP growth and industrial production for 2006 were 6.7% and 4.8%, respectively, relative to 6.4% and 5.7% in 2005. GDP growth is currently derived from non-tradable sectors, but investment remains concentrated in tradables (oil and gas). Construction was the fastest growing sector of the economy, expanding by 14% in 2006. The main private sector services—wholesale & retail trade, banking & insurance, and transportation & communications—showed strong growth of about 10%. In contrast, public sector services—education, health care, and public administration—lagged behind with only 2-4% growth in 2006. Recent productivity growth has still been strong in some parts of domestic manufacturing. Real disposable incomes grew by 10.2% in 2006, spurring considerable growth in private consumption. − − ===Monetary Policy=== − Large balance of payments surpluses have complicated monetary policy for Russia. The Central Bank has followed a policy of managed appreciation to ease the impact on domestic producers and has sterilized capital inflows with its large budget surpluses. However, the Central Bank also has been buying back dollars, pumping additional ruble liquidity into the system. Given the rising demand for money, this has softened the inflationary impact, but these policy choices have complicated the government's efforts to lower inflation to the single digits. Consumer Price Index (CPI) inflation was 9% in 2006 and 10.9% in 2005, having steadily decreased from 20.2% in 2000, due primarily to prudent fiscal policy and in 2006 lower world oil prices. − − ===Commercial Law=== − Russia has a body of conflicting, overlapping and rapidly changing laws, decrees and regulations, which has resulted in an ad hoc and unpredictable approach to doing business. In this environment, negotiations and contracts from commercial transactions are complex and protracted. Uneven implementation of laws creates further complications. Regional and local courts are often subject to political pressure, and corruption is widespread.{{fact}} However, more and more small and medium businesses in recent years have reported fewer difficulties in this regard, especially in the Moscow region. In addition, Russian businesses are increasingly turning to the courts to resolve disputes. Russia's WTO accession process is also helping to bring the country's legal and regulatory regime in line with internationally accepted practices. − − ===Natural Resources=== − − ''See also:'' [[Urals oil]] − − The mineral-packed Ural Mountains and the vast oil, gas, coal, and timber reserves of Siberia and the Russian Far East make Russia rich in natural resources. However, most such resources are located in remote and climatically unfavorable areas that are difficult to develop and far from Russian ports. Nevertheless, Russia is a leading producer and exporter of minerals, gold, and all major fuels. Natural resources, especially energy, dominate Russian exports. Ninety percent of Russian exports to the United States are minerals or other raw materials. − − ===Energy Superpower=== − [[File:Uranium prices.PNG|right|300px|thumb|Uranium spot prices]] − The global demand for [[uranium]] is on the rise, driven by the increasing need for nuclear energy as a clean and efficient power source. Russia stands to benefit significantly from this trend due to its substantial uranium reserves. As the sixth-largest producer of uranium, Russia holds about 8% of the world's uranium resources, with an estimated 486,000 tons. − − Russia's main strength, however, lies not in its reserves but in its dominance in the uranium enrichment sector. Russia controls nearly half of the global enrichment capacity, making it a crucial player in the nuclear fuel supply chain. This strategic advantage positions Russia to meet the growing international demand for enriched uranium, particularly from countries seeking to expand their nuclear energy capabilities. − − With its robust infrastructure and expertise in uranium conversion and enrichment, Russia can offer competitive pricing and reliable supply to global markets. This not only enhances Russia's economic prospects but also solidifies its role as a key supplier in the global nuclear industry. As countries around the world seek sustainable energy solutions, Russia's ability to export enriched uranium will be instrumental in meeting these needs, thereby reinforcing its position as a leading player in the nuclear energy sector and enriching its people in the process. − − ===Industry=== − [[Image:Tower Russia.JPG|right|280px|thumb|]] − Russia is one of the most industrialized of the former Soviet republics. However, years of very low investment have left much of Russian industry antiquated and highly inefficient. Besides its resource-based industries, it has developed large manufacturing capacities, notably in metals, food products, and transport equipment. Russia is now the world's third-largest exporter of steel and primary aluminum. Russia inherited most of the defense industrial base of the Soviet Union, so armaments remain an important export category for Russia. Efforts have been made with varying success over the past few years to convert defense industries to civilian use, and the Russian Government is engaged in an ongoing process to privatize the remaining 9,222 state-owned enterprises, 33% of which are in the industrial manufacturing sector. − <br> − − ===Agriculture=== − In Russia, the triangle St. Petersburg – Irkutsk – Rostov-on-Don can be used for agriculture. The distribution of the population in Russia also coincides with this: More than 80% of Russia’s population lives in the European part of the country, namely in the St. Petersburg – Ekaterinburg – Chelyabinsk – Rostov-on-Don quadrangle. − − ===Investment/Banking=== − [[File:Russian Federation Central Bank.jpg|right|thumb|300px|Russian Federation Central Bank.]] − Russia attracted an estimated $31 billion in FDI in 2006 (3.2% of GDP), up from $13 billion in foreign direct investment (FDI) in 2005.Russia's annual FDI figures are now in line with those of China, India, and Brazil. However, Russia's per capita cumulative FDI still lags far behind such countries as Hungary, Poland, and the Czech Republic. The paradox is that Russia's challenging business climate, lack of transparency, and weak rule of law/corruption{{fact}} has taken a back seat to Russia's extraordinary macroeconomic fundamentals and the consumer and retail boom, which is providing double digit returns to investors and attracting new flows. Russian domestic investment is also returning home, as the foreign investment coming into Russia from havens like Cyprus and Gibraltar, is actually returning Russian capital . As of the end of 2006, loans to the financial sector were 57.2% of total banking sector assets. Retail loans amounted to $78.4 billion at the end of 2006, up from $41 billion at the end of 2005. Retail deposits increased to $144.1 billion from $95.7 billion over the same period. Also, currently deposits are fully insured up to $4,000 and an additional $12,000 is insured at 90%. − − Although still small by international standards, the Russian banking sector is growing fast and is becoming a larger source of investment funds. To meet a growing demand for loans, which they were unable to cover with domestic deposits, Russian banks borrowed heavily abroad in 2006, accounting for two-thirds of the private-sector capital inflows in that year. Ruble lending has increased since the October 1998 financial crisis, and in 2006 loans were 63% of total bank assets, with consumer loans posting the fastest growth at 74% that same year. Fewer Russians prefer to keep their money outside the banking sector, the recent appreciation of the ruble against the dollar has persuaded many Russians to keep their money in rubles or other currencies such as the euro, and retail deposits grew by 65% in 2006. Despite recent growth, the poorly developed banking system, along with contradictory regulations across banking, bond, and equity markets, still makes it difficult for entrepreneurs to raise capital as well as to permit capital transfer from a capital-rich sector such as energy to capital-poor sectors such as agriculture and manufacturing and to diversify risk. Banks still perceive small and medium commercial lending as risky, and some banks are inexperienced with assessing credit risk, though the situation is improving. In 2003, Russia enacted a deposit insurance law to protect deposits up to 100,000 rubles (about $3,700) per depositor, and a bill is currently in the Duma, which if passed will increase this coverage to 190,000 rubles (about $7,000) per depositor. − − [[London]]-based Brand Finance, which evaluates brand strength, rated Sper bank as the strongest brand in Europe in 2023 with a BSI score of 92.3 out of 100 and a corresponding AAA+ rating despite economic sanctions imposed by the [[European Union]].<ref>https://brandfinance.com/insights/brand-spotlight-sber-2022</ref> − − ===Trade=== − [[File:Moscow International Business Centre 2008.jpg|thumb|300px|Moscow International Business Centre, 2008.]] − The U.S. exported $4.7 billion in goods to Russia in 2006, a 21% increase from the previous year. Corresponding U.S. imports from Russia were $19.8 billion, up 29%. Russia is currently the 33rd-largest export market for U.S. goods. Russian exports to the U.S. were fuel oil, inorganic chemicals, aluminum, and precious stones. U.S. exports to Russia were machinery, meat (mostly poultry), electrical equipment, and high-tech products. − − Russia's overall trade surplus in 2006 was $139 billion, up from $118 billion in 2005. World prices continue to have a major effect on export performance, since commodities—particularly oil, natural gas, metals, and timber—comprise 80% of Russian exports. Russian GDP growth and the surplus/deficit in the Russian Federation state budget are closely linked to world oil prices. − − Russia is in the process of negotiating terms of accession to the World Trade Organization (WTO). The U.S. and Russia concluded a bilateral WTO accession agreement in late 2006, and negotiations continue in 2007 on meeting WTO requirements for accession. Russia reports that it has yet to conclude bilateral agreements with Saudi Arabia and Georgia. − − According to the 2005 U.S. Trade Representative's National Trade Estimate, Russia continues to maintain a number of barriers with respect to imports, including tariffs and tariff-rate quotas; discriminatory and prohibitive charges and fees; and discriminatory licensing, registration, and certification regimes. Discussions continue within the context of Russia's WTO accession to eliminate these measures or modify them to be consistent with internationally accepted trade policy practices. Non-tariff barriers are frequently used to restrict foreign access to the market and are also a significant topic in Russia's WTO negotiations. In addition, large losses to U.S. audiovisual and other companies in Russia owing to poor enforcement of intellectual property rights in Russia is an ongoing irritant in U.S.-Russia trade relations. Russia continues to work to bring its technical regulations, including those related to product and food safety, into conformity with international standards.
→Economy
===Labor force===
===Labor force===
The [[Special Military Operation]] created a situation of full employment.
The [[Special Military Operation]] created a situation of full employment.
==History==
==History==