• Russia will resume public sector layoffs, affecting up to 40,000 workers, per Kommersant.
• Deployments have been interrupted due to COVID-19 and Russia’s invasion of Ukraine.
• The cuts would also allow more people to enter the labor market in Russia, which is facing a shortage of workers.

Russia is expected to fire at least 40,000 government officials next year, according to a report by the Russian. Kommersant newspaper.

Russian President Vladimir Putin last month ordered regional branches of federal government agencies to cut staff by 10% by July, according to the publication.

The layoffs were believed to have been planned much earlier, but were put on hold for several years due to Russia’s invasion of Ukraine and the COVID-19 pandemic.

According to Kommersant, the cuts are intended to make public service more efficient and increase the salaries of existing staff.

Official Russian wage statistics released in January show private sector wages rose by 8% to 20% last year.

The cuts would also allow them to tap into Russia’s labor market, which is facing a widespread labor shortage amid Russia’s invasion of Ukraine.

According to an estimate by the Institute of Economics of the Russian Academy of Sciences, Russia had a record 5 million workers at the end of 2023.

The workers were pulled into The war in Ukraine or forced to flee after Putin enacted a major mobilization to increase wartime conscription.

Russia appealed to migrant and work in the penitentiary to supplement its workforce, but these are not sustainable solutions to its population problem, according to a report by Harley Balzer, professor emeritus at Georgetown University.

Last year, the Governor of the Central Bank of Russia, Elvira Nabiullina, warned that it continued labor exhaustion would threaten Russia’s economic growth.

However, so far, the Russian economy has sustained partly because of his war spendingwhich boosted growth despite growth inflation and high interest rates.

Inflation hit 9.8% in September, and potatoes, which are a staple of Russian diets, saw a 64% price increase. this year.

Russia is expected to spend $140 billion for its defense industry in 2024 and up to $145 billion in 2025, or 6.3% of its GDP.