The total rate of the unemployed in Russia grew by 3.1 percent to 5.6m people, or 7.5 percent of the economically active population, in June 2006 compared to June 2005, Russia's Federal Statistics Service reported today. In the first half of 2006 the number of the unemployed edged down by 0.3 percent. The state employment service registered 1.7m unemployed as of late June 2006, including 322,300 in the Chechen republic. The economically active population was 74.7m people, or 51 percent of the country's population. The majority of the employed work in large or medium-sized businesses. They totaled 38.2m people or 55.8 percent of the population in May 2006. Also, large and medium-sized companies attracted 1.9m part time or contract workers (equivalent to full-time employment).
Yet another sign of the coming economic apocalypse in Russia. Despite booming oil revenues Russia's giant population and the Kremlin's greed, together with the total absence of any meaningful reform, pandemic corruption and the absence of a cultural work ethic, mean that Russia continues to spiral into oblivion, unable to create new jobs.
In related news, Interfax reports comments by "President" Putin that succinctly illustrate Russia's Catch-22 situation on oil. Russia may be reaping significant profits by selling oil abroad, but this is diverting energy revenues away from domestic industry and capping potential economic growth. Hence, we see GDP stutter and unemployment rise. Were Russia to attempt to divert oil resources to the development of domestic industry, which can't pay fair market rates for it, this would deprive the Kremlin of its cashflow and potentially place it on the verge of bankruptcy.
Saturday, July 22, 2006