Russian labour market remains soft, while wages continue to recovery

The specifics of Russian local labour market are still intact. Improvements were seen in the unemployment rate as local enterprises prefer to limit wage bill expansion through cutting working hours, but keeping workers on payrolls. 

For now, no reason is seen to change the established practice. Nominal wages appear to be rather stable, but are lagging the cycle of income turnover as enterprises suffer from depressed economic activity. 

"In this respect, the frozen indexation of the public wage bill remains a key signal for other sectors to revise wages. In real terms, the outlook for wages (-6.0% yoy) will improve slightly as inflation slows", says Societe Generale.