Labor Markets of Russian Regions During the Corona Crisis: Features of Regional Adaptation

Abstract

The purpose of the article is to analyze the impact of the COVID-19 pandemic on the labor markets of Russian regions in 2020 and to identify the main factors that determined regional differentiation. The empirical basis of the analysis is the data of Federal State Statistics Service (Labor Force Survey) and Federal Service for Labor and Employment. We analyze the dynamics of employment rate, general and registered unemployment rates, and changes in the proportion of employees who are absent from work for economic reasons. Data analysis was performed using descriptive, cluster and regression methods.It was revealed that the adaptation of the labor markets of Russian regions to the negative consequences of the pandemic had a regionally differentiated character. Five groups of regions have been identified according to the specific features of adaptation to the corona crisis. The dynamics of employment and unemployment was determined by the level of socio-economic development of the region, primarily by the state of its labor market and the level of poverty of the population. Regression estimates showed that the higher the general unemployment rate in the region in 2019 and the share of the population with incomes below the subsistence level were, the greater the decline in employment rate and the growth of general unemployment in 2020 were. The dynamics of registered unemployment rate in 2020 was determined by the share of the population with incomes below the subsistence level, the share of workers in the informal sector and the share of youth in the labor market. This connection is due to the fact that the unemployment benefit in 2020 primarily performed the function of social support for the population with a low level of individual and family incomes.It is shown that the Russian regions, whose labor markets had high employment rates and low unemployment rates, went through the crisis of 2020 retaining their advantages and quickly reached the pre-pandemic state. Regions with a tense situation in labor markets, having experienced a noticeable decline in employment and a significant increase in unemployment in 2020, are recovering from the crisis slowly. The consequence of such dynamics may be an even greater strengthening of regional differentiation.