World Economy

Russian Firms May Cut Jobs

Russian Firms May Cut JobsRussian Firms May Cut Jobs

Russian enterprises affected by the economic downturn in the country last year, may start slashing jobs in 2016, deputy economic development minister, Oleg Fomichev said on Friday.

“We’re facing risks due to last year’s decline in production in the majority of sectors though no employees were released as enterprises expected the situation to improve. But there hasn’t been much of improvement. We think most enterprises may simply change their strategy and start releasing employees,” he said, adding that for this very reason, a budget reserve is needed to offset the risks, Tass reported.

Earlier Fomichev said Russia didn’t face a serious unemployment rise in 2015 while this year employment risks are much higher. “We realize that this year risks are obviously higher,” he said.

According to Fomichev, the plan is to further implement regional employment programs in 2016. “Currently we’re discussing the scale of this aid,” he said.

According to the data provided by Russia’s state statistics service Rosstat, the number of unemployed in Russia stood at 4.264 million  (accounting for 5.8% of economically active population), a 7.4% increase compared with 2014.

The economic development ministry expects Russia’s unemployment to increase to 6.3% in 2016.

 Trade Surplus Down

Russia’s foreign trade surplus decreased by 33% ($48.9 billion) in 2015 to $161.4 billion, according to the documents published by the Federal Customs Service.

Russia’s export dropped by 31.1% to $345.9 billion in 2015 compared with 2014 while import went down by 36.7% to $184.5 billion in the same period.

In 2015, Russia’s external turnover totaled $530.4 billion, a 33.2% decrease compared with 2014.

The European Union (EU) is still Russia’s leading economic partner as it accounted for 44.8% of Russia’s trade turnover (48.1% in 2014).


Recession in the Russian economy will continue, the Bank of Russia said on last Wednesday.

“Industrial production statistics for December 2015 shows that production decline continues on the whole across main kinds of economic activity. This evidences concerns that the decline in the Russian economy will last longer than assumed earlier. The primary reason is the decline in oil prices in the coming months,” the regulator said.

According to the Central Bank, Russia’s budget deficit amid $35 per barrel oil price will grow to 4.8% of GDP.

Also, targeting deficit of 3% of GDP without raising debt burden necessitates a respective spending reduction by almost 9% of 16.1 trillion rubles ($202 billion) outlined by the legislation, the report said.