No mass job losses in Russia but concerns remain: minister

No mass job losses in Russia but concerns remain: minister

Moscow: Russia is unlikely to see lay-offs on a scale of 10% of the workforce but concerns remain over the effects on jobs of the economic slowdown, a minister said in an interview Thursday.

Russian Health and Social Development Minister Tatyana Golikova told the Vedomosti daily she was worried that company towns as well as the machine-building and metals industries would be hit hard.

Asked whether the government was considering a pessimistic scenario envisaging that 10% of the working population would be laid off, she said: “Not yet. It seems to be an unreal number so far."

Citing the ministry’s monitoring data, Golikova said mass lay-offs were not expected in “large sectors."

“There is no surge in lay-offs but I am far from the thought that everything is calm and nothing will be happening in the future," she said.

The sectors where lay-offs will be are most likely metals and machine-building, where average wage levels have traditionally been high, she said.

She said the government had earmarked more than 25 billion rubles (895 million dollars) for unemployment allowances but another 30 billion rubles was needed.

“This is serious money but it is not the money to be sorry about," she said.

The government has recently pledged to raise the monthly unemployment allowance to 4,900 rubles (176 dollars), roughly one third of current average wages.

Prime Minister Vladimir Putin said during a televised question and answer session last week he did not expect mass unemployment, a major source of concern for Russians across the country.

The number of the jobless will rise to just over 2.0 million from the 1.7 million currently registered, Putin said.

As Russian companies struggle to stay afloat in the face of the economic crisis, experts say that the number of the unemployed could be significantly higher and rise even further.