Reasons for the Labor Shortage
The labor shortage has been caused, in large part, by the mass exodus of hundreds of thousands of Russians. Many highly-skilled IT professionals emigrated from the country following what the Kremlin referred to as a “special military operation” in Ukraine, which commenced in February 2022. The reasons for leaving included disagreement with the war and fear of being conscripted. President Vladimir Putin’s announcement of a partial military mobilization of around 300,000 recruits in September 2022 only served to intensify the outflows.
Impact on the Economy
Russia’s depleted labor force has become a significant concern for the Central Bank and is posing a threat to economic growth. The crisis has prompted Moscow to allocate substantial fiscal and physical resources to the military. Central Bank Governor Elvira Nabiullina emphasized this challenge last month. She recognized that acute labor shortages are hampering various sectors and impeding the country’s economic progress.
Profound Impact on Various Sectors
According to Labor Minister Anton Kotyakov, the manufacturing, construction, and transportation sectors have been hit particularly hard by the lack of available workforce. Companies in these industries have been forced to resort to increasing wages in an attempt to attract more employees. However, the scarcity of skilled workers remains a major concern. Vacancies for factory workers, engineers, doctors, teachers, and other professions are expected to be especially challenging to fill.
Future Outlook
Nikolai Akhapkin, the author of the research cited by Izvestia, predicts that the labor shortages will continue to persist in the coming year. Poor demographics and population migration are among the key reasons contributing to the ongoing deficit. As a result, Russia will face an uphill battle in replenishing its workforce and securing the necessary talent in critical sectors.