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. Last Updated: 07/27/2016

Unemployment Is Still Soaring

Unemployment has more than doubled in the past two months, according to government statistics, and officials say they are ill-equipped to deal with the growing number of jobless people.


More than 1 million Russians are registered as unemployed - up from 469, 000 people in January. Another 3 million people are working for reduced hours and pay by state-funded companies staving off bankruptcy, Fyodor Prokopov, head of Russia's Federal Employment Service, said Wednesday.


But Russia's unemployment fund - 40 billion rubles ($59 million) in 1992 - is too small to deal with growing joblessness, which is bound to increase if state subsidies to inefficient companies are cut, officials said.


"We're facing a deficit", Prokopov said at an international labor conference sponsored by the Federal Employment Service. "We need more efficient training programs and help".


Western labor analysts say that unemployment here is even higher than Russian officials estimate. Guy Standing, director of the International Labor Organization for Central and Eastern Europe, said Russia already has about 5 million unemployed. The discrepancy, he said, is because most, unemployed are not officially registered.


Russians now receive 2, 500 rubles a month in unemployment benefits, although that should double to 4, 500 rubles soon, said Molly Meacher, a British adviser to Prokopov. The benefits are doled out at about 2, 500 employment centers across Russia. The money comes from a 2 percent wage tax collected for the unemployment fund. Russia needs to expand its retraining programs and is counting on Western aid and technical assistance to do so, Meacher said. For example, $10 million of the World Bank's $70 million loan to Russia is targeted for retraining programs, she added.


Various foreign nationals are now initiating retraining programs to help. One such program, organized by a Canadian group, acted in a preemptive way by setting up a program within one textile factory in Vladimir, northeast of Moscow, to help retrain workers before they lost their jobs, Meacher said.


Yet by the end of February, only 3. 4 percent of Russia's registered unemployed participated in retraining programs, according to officials who say the numbers must increase.


Politics also has a lasting impact on the employment centers, labor analysts say. For example, just as regions outside of Moscow do not always follow directives from the capital, it is difficult for the Federal Employment Service to monitor employment centers across the country. It is equally difficult to ensure that the 2 percent wage tax marked for the employment fund is actually collected.


Another point of controversy during the seminar centered around the number of jobless women. According to official statistics, women make up 70 percent of the registered unemployed across the country.