Regional Review

While Moscow booms and expands, the regions simmer. A landlocked real estate market in the capital has forced leading developers to turn their gaze outward, beyond the ring roads, to the regions, where new development- friendly legislation and plentiful resources offer the kind of vast macroeconomic scope that attracted investment into Russia in the first place. Jobs, in turn, have followed.

"Regional job markets have the same tendencies as Moscow. Lots of multinational companies are trying to develop their businesses outside Moscow and St. Petersburg as a result of the economic growth in Russia," Flex Agency's Ilya Labutin said.

Alexander Terpigorev at Acuris is also impressed by the healthy bloom of the regional market: "Some multinational and some local companies in the current year have started their regional sales offices from zero. Several businesses are starting production sites. Overall, it is good to live in the Russian regions right now!"

Others set the time lag at one to two years behind Moscow, although assessments from local recruitment companies differ as to the strength of the regional jobs market vis-a-vis Moscow. Irina Kondratova, regional network director at ANCOR reports that in the past year the tempo of growth in demand for qualified professionals in the regions has actually outpaced that in the capital, while Antal finds that their supply problems are focused here. "Our clients are increasingly asking us to source candidates in the regions to fill roles in Moscow," said Nick Rees, partner at Antal International.

Regardless of the universally acknowledged incongruence between Moscow and the regions, there is unanimous agreement that beyond the capital's limits, the competition for specialized personnel is stiff. How companies fill their positions varies from one case to another. At times, companies cannibalize the professional workforce of other regional businesses, at others, they choose to draw from the capital's pool of specialists. Flex Agency's Labutin speaks of a deficit of ideal employees endemic to the regions: "The first problem the companies face is the lack of highly qualified personnel in almost all sectors and this difficulty can hardly be resolved immediately. To fill the position in regions recruitment consultants present candidates from Russian companies that worked in that region before. At the same time lots of candidates do not correspond to the position profiles as they don't have relevant experiences and are not fluent in English.

"Some HR managers ask recruitment consultants to hunt candidates from their competitors; in that case companies have to be ready for overpriced compensation expectations. Lots of companies tend to transfer their employees to regional offices for a long business trip and that is considered to be the most optimum decision."

Tapping into a general impatience among a young, mobile corps of professional specialists is one strategy regional offices are using to fill gaps in expertise on a temporary basis, though they must be willing to pay to attract out-oftown talent for short stints to the regions.

The mobility of today's workforce keeps the brightest talent following the most attractive route of growth, both professional and financial, a road that, according to Sergei Razhev, head of executive search company Penny Lane Consulting, is increasingly leading to the regions, where attractive compensation packages await qualified specialists who agree to relocate on a temporary basis.

The industries most in need of outside recruitment are the giants. Oil and gas sectors are the traditional leaders, followed by real estate development. Heavy industry, feeling the squeeze of rising land values in Moscow and St. Petersburg, is shifting to regional cities, where infrastructures are being put in place and workforces being assembled to pick up production. In some cases, leading local businesses are eager to bring multinational expertise to their regional offices on a consultative basis.

While Moscow continues to lead the country in terms of per capita income and living standards, a gradual closing of the gap between pay for identical positions in Moscow and in the regions has been observed by ANCOR's Kondratova. She notes that on average, in the past year salaries increased from 10 to 12 percent in the regions, well ahead of inflation.