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. Last Updated: 07/27/2016

New labor czar strikes back

Russia's new labor minister has launched his appointment by bashing his predecessor's appeasement policy during the May wave of strikes and strike threats by miners and medical, education and transportation workers.


"Strikes were very important in the first half of this year", Gennady Melikyan said Wednesday. "We had to decide all these questions, and I think all of these policies were a mistake. We reacted too quickly to reforms. As a result of the strikes, doctors now have very small salaries and miners have large ones.


"But now the situation has changed and the government now wants to find another way to provide social and economic reforms", he said.


While Melikyan, a 45-year-old economist, is a political unknown, he has long been involved in back-room government policy making. Alexander Shokhin, the former labor minister, is now a deputy prime minister.


In the first six months, the Russian government raised the salaries of striking workers significantly, in part out of fear that massive strikes could threatened President Boris Yeltsin's reform government.


But that policy only serves to perpetuate an ever-spiralling series of wage demands, Melikyan said.


Melikyan announced that the minimum wage would increase from 900 to 1, 035 rubles per month. He said he planned to keep wages relatively stable and to implement a system of vouchers under which every Russian


citizen would receive about 8, 000-10, 000 rubles worth of vouchers each month to be spent on food and other goods in state stores. He did not elaborate except to acknowledge that many people would be likely to sell the vouchers for cash "and the rich will get richer while the poor get poorer".


Melikyan also warned Russians to prepare for rising unemployment. While only 202, 879 Russians were officially registered as unemployed in June, officials estimate the figure will grow to 2 million by the end of the year.


"Our people don't want to think about unemployment because we never had it before", Melikyan said. "But people need to prepare themselves. Unemployment will be the normal thing in our country".