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Socio-demographic factors of labour market functioning

Priority areas of development: economics
2016
The project has been carried out as part of the HSE Program of Fundamental Studies.

The project was implemented within the framework of the HSE Basic research program.

Present report introduces the results of a project dedicated to the studies of socio-demographic features of the Russian labour market that are to be conducted by the Centre for Labour Market Studies of NRU HSE in 2016-2018. The set of studies comprising present report was carried out in 2016 and cover various aspects of labour market position of different socio-demographic groups – the youth, the elderly, public sector workers, mothers with children, migrants. 

Research object of the surveys presented in the report consists of socio-demographic features of labour market functioning.

Research purpose of the surveys is the comprehensive analysis of Russian labour market processes within the scope of demographic structure and its current trends.

Empirical base of the research is largely provided by the Russia Longitudinal Monitoring Survey – Higher School of Economics (RLMS-HSE) covering the period of 1994-2015. Micro-data from the regular Labour Force Survey and October survey of Occupational Wages collected by the Federal State Statistics Service (“Rosstat”) as well as Life in Kyrgyztan (LIK) data should also be mentioned on their own account. OECD Labour Force Database and European Social Survey were used in order to analyze Russian labour market in a cross-country perspective.

Research results showed that total number of employed in 2030 will decrease by approximately 8% of total employed population of 2015. This can lead to significant negative shock of labor supply. At the same time the global process of aging affects different age groups in a very uneven way, and thus it will inevitably lead to significant changes in employment structure in different industries and occupations. Present report also includes the analysis of the so-called NEETs – e.g. those young people aged 15-24 who are not in the employment, education or training. The ratio of this category of youth was decreasing significantly during the period of 1995-2015. In 2015 it reached 12% of total population aged 15-24. The main factors of joining this category are mainly associated with disadvantages – low levels of education, early marriage and childbirth, rural settlement type. Present report also covers the issue of socio-demographic features of public sector workers. Wages in public sector are usually about 25% lower than those in private sector. The variation in the value of the wage gap between sectors depending on certain socio-demographic characteristics of employees is very significant. The gap is bigger for women and workers with relatively low levels of education. At the same time those public sector workers who have either large work experience or live in rural areas have a comparative advantage in wages. Analysis of employment inequality among Russian households shows that its amount is generally rather low which can be explained by low unemployment benefits. Additional explanations is provided by large level of informal employment on the Russian labour market and tradition of coexistence within large, often multigenerational, families. The report also presents an analysis of migration flows into the Russian labour market from countries with underdeveloped economies (such as Kyrgyzstan). The study demonstrated that migration often emerges a kind of adaptive mechanism that allows households to increase the inflow of investments and, thus, to adapt to external natural shocks (such as mudslides, landslides and floods). The report also analyzes one of the main factors of labour supply - the determinants of reservation wage and its impact on job search duration. Reservation wage in Russia is highly dependent on the characteristics of local labor markets. In the regions with high wages and low unemployment reservation wage is much higher than in regions with low wages and high unemployment. Individuals with high payroll claims are also more likely to enter employment, e.g. find a new job. This suggests that differences in the payroll claims reflect differences in the characteristics of the workers’ productivity. The report also contains the results of the investigation of the labor supply of women with young children. Russian data managed to confirm the well-known theoretical conclusion that the presence of preschool children has a negative impact on the labour force engagement of women. In this respect the availability of kindergartens also has a strong positive impact on the labour supply of mothers. The final section of the report is devoted to a comparative analysis of the age structure of the labor markets in the OECD countries. As research shows older workers have significantly improved their position on the labour market in 2000-2015 which is reflected in the increasing level of their economic activity and employment. This came as a result of significant labor shortages due to demographic changes (process of aging). High levels of education, health improvement of older cohorts and extension of their active life in general also create conditions for a long working life.

Implementation of the research results

Results presented in the report can be used in social and economic policy recommendations. They also can have a number of important consequences for the evolution of modern labour market theory and methodology. Results presented in a present report provide new empirical results that contribute to the understanding of the contemporary features of Russian labour market mechanisms. Main results and the methodology of empirical studies described in the report can also be used in the labour economics courses.

Publications:


Chernina E. Migrants’ location choice: the role of migration experience / Maastricht School of Management. Series MSM "MSM WORKING PAPER SERIES". 2016. No. 2016/3.
Vishnevskaya N., Lukyanova A. Decentralisation of the minimum wage setting in Russia: Causes and consequences // Economic and Labour Relations Review. 2016. Vol. 27. No. 1. P. 98-117. doi
Лукьянова А. Л. Неравенство в распределении занятости между российскими домашними хозяйствами // Экономический журнал Высшей школы экономики. 2016. Т. 20. № 3. С. 415-441.
Гимпельсон В. Е., Капелюшников Р. И., Ощепков А. Ю. Премия за специальный стаж в России: возвращение к теме // Экономический журнал Высшей школы экономики. 2016. Т. 20. № 4. С. 553-587.

 

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