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RUSSIA: Tight Curbs Placed on Foreign Labour

Kester Kenn Klomegah

MOSCOW, Jun 23 2008 (IPS) - Russia is not increasing grant of work permits despite a growing demand for foreign labour.

First deputy prime minister Igor Shuvalov acknowledged at the 12th International Economic Forum held early this month in St. Petersburg that shortage of skilled labour is holding back growth. He said that given the right combination of labour and capital resources, Russia could become the world’s sixth largest economy. At present France is in sixth place, after the U.S. Japan, Germany, China and Britain.

But the Federal Migration Service (FMS), the state agency responsible for labour issues, has brought in a quota system that would drastically reduce the number of foreign workers, especially from the ex-Soviet republics, who seek employment in Russia.

Labour experts say such strict measures will harm economic growth. “An enormous contribution is made by a lot of migrant workers from the ex-Soviet republics towards Russia’s economy. Many migrants are filling a niche in the domestic labour market by doing odd jobs that local citizens don’t want,” Nilim Baruah, chief technical advisor to the Regional Migration Programme of the International Labour Organisation (ILO) in Moscow told IPS.

The ILO expert agreed, however, that “there is a need to regulate the labour market to reduce the demand for irregular migrant workers in certain sectors of the economy. There is also a need to encourage internal labour mobility.”

Russia has annual quotas for visa-free (Commonwealth of Independent States except Georgia and Turkmenistan) and for other countries. There is also provision in the legislation for introducing a priority list of occupations above the quota.

The ILO is now working with Russian authorities and employer and workers’ federations on methods to more accurately assess the demand for foreign workers so that employers find it easier to recruit migrant workers in labour shortage occupations while jobs are protected for nationals in professions where there are no shortages.

The number of migrant workers allowed to work legally in Russia was reduced from around six million in 2007 to less than two million in 2008. Non-Russians were banned from working in markets and retail trade.

“If the annual quota is not in line with labour market needs, the risk is that migrant workers from visa-free countries will enter and find unauthorised employment over and above the quota,” Baruah said. “Unauthorised employment places the worker in a vulnerable position with regards to entitlements, besides loss of tax revenue for the state.”

Up to five million irregular migrants currently live in Russia, a top interior ministry official recently suggested.

According to Federal Security Service data, more than 21 million people officially enter Russia each year for transit, tourism and work. “Some of these travel into European and Asian countries, while some, without obtaining the required documentation, settle in Russia and become illegal immigrants,” says Gennady Ivanov, deputy head of the ministry’s criminal investigation department.

Many people coming from the Central Asian Republics Tajikistan, Uzbekistan, Kyrgyzstan, Kazakhstan and Turkmenistan are not familiar with Russian laws and customs, and do not speak Russian. The FMS has now made knowledge of Russian of intermediate level standard necessary for an employment permit.

The FMS announced in May that it was no longer accepting applications for work permits in some Russian districts, including Moscow.

“Although Russia obviously needs migrants to accelerate economic growth, we have stopped obtaining and processing applications for permits because the quota set for this year was exhausted,” FMS spokesman Konstantin Poltaranin told IPS.

But he granted that “despite the fact that the government has set limitations for hiring foreigners, the country would continue to experience an influx of illegal labour due to the worsening economic situation in the economies of the ex-Soviet republics.”

Elena Tyuryukanova, a senior researcher on labour policy at the Institute for Socio-Economic Studies of Population under the Russian Academy of Sciences described the 2008 quota as too small. Her institute has estimated the flow of labour migrants to Russia at seven to nine million in the peak season.

“The exact statistics of people crossing borders is difficult to find because the greater part of labour flow comes for other purposes (like short business trips, official trips and private visits). According to FMS statistics and our surveys about 50 percent migrants are employed in the shadow economy because their employers do not notify the migration service,” Tyuryukanova told IPS.

“The use of migrant labour could be a useful vehicle for development. But quota should be real and necessarily reflect real demand in the labour market. The restrictive character of quotas would negatively affect the economy or hamper growth.”