Tuesday, April 16, 2019

Kremlin’s Boost of Pension Age Seen Doubling Russian Unemployment Rate by 2024

Paul Goble

            Staunton, April 16 – Many thoughtful analysts have suggested that the Kremlin’s decision to boost the pension age would ultimately have a negative impact not just on pensioners and those near pension age but on the entire population. Now, a new study says that this policy will roughly double the unemployment rate of working age Russians by 2024.

            Aleksey Kashepov, an analyst at the Moscow Institute for Macroeconomic Research of the Ministry for Economic Development, says that as a result of the boost in the pension age, unemployment in Russia will increase from 4.9 percent now to 9.6 – 9.7 percent five years from now (nakanune.ru/news/2019/4/15/22538326/).

            That will mean that nearly eight million Russians will be without work, a situation that will not only involve enormous suffering among them and those who depend on them but also impose significant social welfare costs on the state and possibly threaten a rise of anomic and anti-social behavior.

            “Particular attention should be devoted to people of pre-pension age,” Kashepov says, “since this category is more likely to be harmed by the risk of unemployment.” But that will not be easy because using regulations to limit unjustified dismissals of people in this age cohort will have negative consequences as well as positive ones.

            The economic analyst does not address the political consequences of this; but an increase in unemployment and in the threat of unemployment will almost certainly lead to greater support for left-of-center parties and perhaps will cause some in this risk group to engage in active protests against the powers that be who have led to their immiseration.

            Clearly, the situation for many Russians is increasingly dire.  A Gazeta article says that Russia’s poorest now lack money even for bread (gazeta.ru/business/2019/04/16/12298747.shtml), and a Svobodnaya pressa analysis adds that the Kremlin has left the Russian people not only with no money but with no hope either (svpressa.ru/society/article/230353/).

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